John H. Furbee Aquatics Center Operations Study

Final Report John H. Furbee Aquatics Center Operations Study Ken Ballard Ballard*King & Associates 2743 E Ravenhill Cir. Highlands Ranch, CO 80126 (303) 470-8661 ken@ballardking.com March 6, 2013

Table of Contents Section I Demographic Summary & Market Review...1 Section II Benchmark Facilities...48 Section III Operations Analysis...58 Section IV Appendix...74

MARKET ANALYSIS Section I Demographic Summary & Market Review The has engaged Ballard*King & Associates to assist in completing an operations study for the new John H. Furbee Aquatic Center. The following is a summary of the basic demographic characteristics of the identified service areas as provided by Environmental Systems Research Institute, Inc. (ESRI) along with aquatic participation rates as produced by the National Sporting Goods Association (NSGA) in their 2011 Survey. Service Areas: It is recognized that the aquatic center s primary goal will be to serve the residents of the but it will be open to all users regardless of where they reside. In determining service areas this information was considered and balanced with the reality of how far individuals would be willing to travel for this type of aquatic facility. Based on this premise, B*K worked with the to determine their sphere of influence which has been used as the primary service area and then identified a larger secondary service area. Primary service areas are usually defined by the distance people will travel on a regular basis (a minimum of once a week) to utilize an aquatic center or its programs. Secondary service areas are usually defined by the distance people will travel on a less consistent basis (a minimum of a couple of times a month) to utilize a facility or its programs. Use by individuals outside the secondary service area will primarily be limited to special events (swim meets, water polo matches, etc.). Service areas can also vary in size with the types of amenities that are included in a facility. An aquatic center with a strong leisure pool (zero depth entry, interactive play features, slides, etc.) will generally have a larger service area than a more traditional flat water competitive oriented facility. Since the John H. Furbee Aquatic Center has a large traditional pool and only a small splash pad, the market area will be smaller. Service areas can also be influenced based on an aquatics facility s impact from major thoroughfares and the presence of alternative aquatic providers in the area. Alternative aquatic providers can have an impact upon membership, daily admissions and the associated penetration rates for programs and services. As a result, the Desert Hot Spring s aquatic market is negatively impacted by the presence of I-10 and the pools that are located in Palm Springs, Palm Desert and other locations. Page 1

MARKET ANALYSIS Table A Service Area Comparison Chart: City of Desert Hot Springs Primary Service Area Secondary Service Area Population: 2010 Census 25,938 36,661 47,493 2012 Estimate 26,288 37,297 48,308 2017 Estimate 27,763 39,657 51,393 Population Growth 2000-2010 Census +46.2% +52.6% +50.4% Households: 2010 Census 8,650 12,133 16,978 2012 Estimate 8,843 12,436 17,410 2017 Estimate 9,229 13,042 18,286 Families: 2010 Census 5,782 8,188 10,971 2012 Estimate 5,905 8,320 11,142 2017 Estimate 6,215 8,802 11,808 Average Household Size: 2010 Census 2.98 3.00 2.78 2012 Estimate 2.96 2.98 2.76 2017 Estimate 2.99 3.02 2.80 Ethnicity: Hispanic 55.2% 56.1% 50.8% White 57.4% 58.9% 62.9% Black 7.5% 6.6% 5.5% American Indian 1.4% 1.3% 1.4% Asian 2.5% 2.2% 2.0% Pacific Islander 0.3% 0.3% 0.2% Other 26.0% 26.1% 23.7% Multiple 4.9% 4.6% 4.3% Median Age: 2010 Census 31.1 32.4 35.7 2012 Estimate 31.7 32.7 36.2 2017 Estimate 32.4 33.5 37.2 Median Household Income: 2012 Estimate $31,976 $33,139 $33,192 2017 Estimate $35,946 $37,435 $37,607 Household Budget Expenditures 1 : Housing 67 68 68 Entertainment & Recreation 65 68 69 1 This information is placed on an index with a reference point being the National average of 100. Page 2

MARKET ANALYSIS Median Age and Household Income The median age and household income levels are compared with the national number as both of these factors are primary determiners of participation in aquatic activities. The lower the median age, the higher the participation rates are for most activities. The level of participation also increases as the median income level goes up. Table B Median Age: 2010 Census 2012 Projection 2017 Projection 31.1 31.7 32.4 Primary Service Area 32.4 32.7 33.5 Secondary Service Area 35.7 36.2 37.2 State of California 35.2 35.3 35.8 Nationally 37.1 37.3 37.8 Chart A Median Age 40 35 30 25 20 15 10 5 0 2010 2012 2017 Primary Secondary California National With the median age in the Primary Service Area being than the state and national number it would point to a community with a younger population base. Page 3

MARKET ANALYSIS Map A 2012 Median Age by Census Block Groups Page 4

MARKET ANALYSIS Table C Median Household Income: 2012 Estimate 2017 Projection $31,976 $35,946 Primary Service Area $33,139 $37,435 Secondary Service Area $33,192 $37,607 State of California $57,385 $67,664 Nationally $50,157 $56,895 Chart B Median Household Income $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 2012 2017 Primary Secondary California National Page 5

MARKET ANALYSIS Based upon 2012 projections the following narrative can be provided for the service areas: In the Primary Service Area the percentage of households with median income over $50,000 per year is 32.8% compared to 50.1% on a national level. Furthermore, the percentage of the households in the service area with median income less than $25,000 per year is 35.9% compared to a level of 24.7% nationally. In the Secondary Service Area the percentage of households with median income over $50,000 per year is 32.7% compared to 50.1% on a national level. Furthermore, the percentage of the households in the service area with median income less than $25,000 per year is 36.1% compared to a level of 24.7% nationally. These statistics indicate that the level of income for the service area is significantly less in comparison to the state and national numbers. This information must also be balanced with the overall cost of living (which is reviewed in the following pages). Page 6

MARKET ANALYSIS Map B 2012 Median Household Income by Census Tract Page 7

MARKET ANALYSIS Household Budget Expenditures In addition to taking a look at Median Age and Median Income, it is important to examine Household Budget Expenditures. In particular looking at housing information; shelter, utilities, fuel and public services along with entertainment & recreation can provide a snap shot into the cost of living and spending patterns in the services areas. The table below looks at that information and compares the service areas. Table D Household Budget Expenditures 2 SPI Average Amount Spent Percent Housing 67 $13,178.98 31.2% Shelter 67 $10,236.58 24.3% Utilities, Fuel, Public Service 67 $2,942.40 7.0% Entertainment & Recreation 65 $2,040.13 4.8% Primary Service Area SPI Average Amount Spent Percent Housing 68 $13,435.00 31.0% Shelter 68 $10,394.14 23.9% Utilities, Fuel, Public Service 69 $3,040.86 7.0% Entertainment & Recreation 68 $2,111.29 4.9% Secondary Service Area SPI Average Amount Spent Percent Housing 68 $13,295.53 30.4% Shelter 67 $10,295.27 23.3% Utilities, Fuel, Public Service 71 $3,100.26 7.1% Entertainment & Recreation 69 $2,158.77 4.9% State of California SPI Average Amount Spent Percent Housing 122 $24,091.71 31.7% Shelter 126 $19,248.87 25.3% Utilities, Fuel, Public Service 110 $4,842.84 6.4% Entertainment & Recreation 120 $3,735.75 4.9% SPI: Spending Potential Index as compared to the National number of 100. Average Amount Spent: Percent: The average amount spent per household. Percent of the total 100% of household expenditures. Note: Shelter along with Utilities, Fuel, Public Service are a portion of the Housing percentage. 2 Consumer Spending data are derived from the 2004 and 2005 Consumer Expenditure Surveys, Bureau of Labor Statistics. ESRI forecasts for 2012 and 2017. Page 8

MARKET ANALYSIS Chart C Household Budget Expenditures Spending Potential Index 140 120 100 80 60 40 20 0 Housing Shelter Utilities, Fuel, Public Service Entertainment & Recreation Primary Secondary California National Chart C, illustrates that the Household Budget Expenditures Spending Potential Index in the City, Primary and Secondary service areas are lower than the national level, while the state level is higher than the national level. This would indicate that fewer dollars are being spent for those services as compared to a state and national level. This would indicate a significantly lower cost of living in the service areas, but the level of discretionary income available for entertainment and recreation is only 65% of the national number and 54% of the state figures. It will be important to keep this information in mind when developing fee structure and looking at an appropriate cost recovery philosophy. Page 9

MARKET ANALYSIS Recreation Expenditures Spending Potential Index: In addition to the more general spending potential index, ESRI also measures more specific recreation expenditures in a number of different areas and then indexes this against national numbers. The following comparisons are possible. Table E Recreation Expenditures Spending Potential Index 3 SPI Average Spent Fees for Participant Sports 63 $64.95 Fees for Recreational Lessons 60 $79.48 Social, Recreation, Club Membership 61 $96.39 Exercise Equipment/Game Tables 52 $41.61 Other Sports Equipment 65 $5.94 Primary Service Area SPI Average Spent Fees for Participant Sports 65 $67.64 Fees for Recreational Lessons 60 $79.05 Social, Recreation, Club Membership 61 $97.04 Exercise Equipment/Game Tables 54 $43.16 Other Sports Equipment 66 $6.06 Secondary Service Area SPI Average Spent Fees for Participant Sports 67 $69.36 Fees for Recreational Lessons 57 $75.47 Social, Recreation, Club Membership 61 $97.64 Exercise Equipment/Game Tables 55 $43.96 Other Sports Equipment 66 $6.09 State of California SPI Average Spent Fees for Participant Sports 123 $127.15 Fees for Recreational Lessons 128 $169.84 Social, Recreation, Club Membership 123 $195.62 Exercise Equipment/Game Tables 96 $76.37 Other Sports Equipment 114 $10.43 Average Amount Spent: The average amount spent for the service or item in a year. SPI: Spending potential index as compared to the national number of 100. 3 Consumer Spending data are derived from the 2006 and 2007 Consumer Expenditure Surveys, Bureau of Labor Statistics. Page 10

MARKET ANALYSIS Chart D Recreation Spending Potential Index 140 120 100 80 60 40 20 0 Fees for Participant Sports Fees for Recreational Lessons Social, Recreaiton, Club Membership Exercise Equipment/Game Tables Other Sports Equipment Primary Secondary California National The SPI index indicates that in the city, primary and secondary service areas the rate of spending is substantially lower than the National Spending Potential Index (SPI) of 100 and the state level. This information is very important when determining a price point for activities and the cost recovery philosophy as the level of discretionary income for recreation is approximately 60% of the national level and 50% of the state level. It is also important to note that these dollars are currently being spent, so the identification of alternative service providers and the ability of another facility to capture a portion of these dollars will be important. Page 11

MARKET ANALYSIS Map C 2011 Entertainment & Recreation Spending by Census Tract Service Area Demographics The Primary and Secondary Service Areas demographic characteristics are analyzed on the following pages. Page 12

MARKET ANALYSIS Map D Primary Service Area Map ( Sphere of Influence) Page 13

MARKET ANALYSIS Population Distribution by Age: Utilizing census information for the Primary Service Area, the following comparisons are possible. Table F 2012 Primary Service Area Age Distribution (ESRI estimates) Population: Ages Population % of Total Nat. Population Difference -5 3,191 8.6% 6.5% +2.1% 5-17 7,840 21.0% 17.2% +3.8% 18-24 3,750 10.1% 9.8% +0.3% 25-44 9,558 25.6% 26.5% -0.9% 45-54 4,704 12.6% 14.1% -1.5% 55-64 3,661 9.8% 12.3% -2.5% 65-74 2,652 7.1% 7.5% -0.4% 75+ 1,943 5.2% 6.1% -0.9% 2012 census estimates in the different age groups in the Primary Service Area. % of Total: Percentage of the Primary Service Area population in the age group. National Population: Difference: Percentage of the national population in the age group. Percentage difference between the Primary Service Area population and the national population. Chart E 2012 Primary Service Area Age Group Distribution 30 25 20 15 10 5 0-5 5-17 yrs 18-24 25-44 45-54 55-64 65-74 75+ Primary Service Area National Page 14

MARKET ANALYSIS The demographic makeup of the Primary Service Area, when compared to the characteristics of the national population, indicates that there are some differences with an equal or larger population in the -5, 5-17 and 18-24 age groups and a smaller population in the 25-44, 45-54, 55-64, 65-74 and 75+ age groups. The largest positive variance is in the 5-17 age group with +3.8%, while the greatest negative variance is in the 55-64 age group with -2.5%. Page 15

MARKET ANALYSIS Population Distribution Comparison by Age: Utilizing census information from the Primary Service Area, the following comparisons are possible. Table G 2012 Primary Service Area Population Estimates (U.S. Census Information and ESRI) Ages 2010 Census 2012 Projection 2017 Projection Percent Change Percent Change Nat l -5 3,159 3,191 3,368 +6.6% +4.7% 5-17 7,881 7,840 8,221 +4.3% +1.8% 18-24 3,699 3,750 3,695-0.1% -2.4% 25-44 9,463 9,558 10,031 +6.0% +10.4% 45-54 4,764 4,704 4,612-3.2% -6.2% 55-64 3,431 3,661 4,075 +18.8% +13.7% 65-74 2,413 2,652 3,428 +42.1% +32.9% 75+ 1,852 1,943 2,226 +20.2% +9.5% Chart F Primary Service Area Population Growth 12,000 10,000 8,000 6,000 4,000 2,000 0-5 5-17 yr 18-24 25-44 45-54 55-64 65-74 75+ 2010 2012 2017 Table-G, illustrates the growth or decline in age group numbers from the 2010 census until the year 2017. It is projected that all of the age categories except 18-24 and 45-54 will see an increase in population or static growth. It must be remembered that the population of the United States as a whole is aging and it is not unusual to find negative growth numbers in the younger age groups and significant net gains in the 45 plus age groupings in communities which are relatively stable in their population numbers. Page 16

MARKET ANALYSIS Race and Ethnicity Listed below is the distribution of the population by race and ethnicity for the Primary Service Area for 2012 population projections. Those numbers were developed from 2010 Census Data. Table H Primary Service Area Ethnic Population and Median Age (Source U.S. Census Bureau and ESRI) Ethnicity Total Median Age % of Population % of California Population Population Hispanic 20,922 24.1 56.1% 38.4% Table I Primary Service Area Population by Race and Median Age (Source U.S. Census Bureau and ESRI) Ethnicity Total Population Median Age % of Population % of California Population White 21,975 40.5 58.9% 56.9% Black 2,444 26.1 6.6% 6.1% American Indian 491 27.6 1.3% 1.0% Asian 828 41.1 2.2% 13.2% Pacific Islander 100 26.7 0.3% 0.4% Other 9,728 24.1 26.1% 17.3% Multiple 1,731 20.0 4.6% 5.0% 2012 Primary Service Area Total Population: 25,699 Residents Note: According to the United States Census Bureau, Hispanic is an ethnic group but not a race. Therefore Hispanics are also members of a race category as well. For this reason Hispanic is shown in a separate table and the totals for Table H and I will not add up to 100%. Page 17

MARKET ANALYSIS Chart G Primary Service Area Non-White Population by Race 1.3% 2.2% 0.30% 6.6% 4.6% 26.1% Black American Indian Asian Pacific Islander Other Multiple Tapestry Segments: In addition to look at the age group distribution, population growth along with ethnicity and race of the service area B*K can further examine the service area by examining the various tapestry segments. The following table outlines the top 5 tapestry segments within the Primary Service Area Service Area and provides definitions for each of the tapestries. Table J Primary Service Area Tapestry Segment Comparison (ESRI estimates) Primary Service Area U.S. Households Cumulative Cumulative Percent Percent Percent Percent Industrious Urban Fringe 33.4% 33.4% 1.5% 1.5% City Dimensions 25.4% 58.8% 0.9% 2.4% Midlife Junction 10.8% 69.6% 2.5% 4.9% Southwestern Families 9.4% 79.0% 1.0% 5.8% Rural Resort Dwellers 8.5% 87.4% 1.6% 7.5% Industrious Urban Fringe (38) Family is central with more than ½ of the households having children; 54% are married-couple families, 17% are single parents. Multi-generational households are common. Most work in the manufacturing, construction, retail trade and service industries. Page 18

MARKET ANALYSIS City Dimensions (60) Diversity in household type and ethnicity characterizes these neighborhoods. Households are a mix of types; most are singles that live alone. Ethnic diversity is high. Midlife Junction (33) Nearly 20% of this group are aged 65 years or older. Households are a mix of family types and singles who live alone or share housing. Most of these residents are white. Southwestern Families (59) A mix of family types comprise 80% of the households. These young families form the foundation of Hispanic life in the Southwest. Children are the center of these households that are composed mainly of married couples with children and single-parent families. Ethnic diversity is high. Rural Resort Dwellers (31) These neighborhoods are found in pastoral settings in rural nonfarm areas throughout the U.S. Household types include empty-nester married couples, singles and married couples with children. Most residents are white. Page 19

MARKET ANALYSIS Map E Secondary Service Area Map Page 20

MARKET ANALYSIS Population Distribution by Age: Utilizing census information for the Secondary Service Area, the following comparisons are possible. Table K 2012 Secondary Service Area Age Distribution (ESRI estimates) Population: Ages Population % of Total Nat. Population Difference -5 3,763 7.8% 6.5% +1.3% 5-17 9,253 19.2% 17.2% +2.0% 18-24 4,449 9.2% 9.8% -0.6% 25-44 11,618 24.0% 26.5% -2.5% 45-54 6,284 13.0% 14.1% -1.1% 55-64 5,359 11.1% 12.3% -1.2% 65-74 4,313 8.9% 7.5% +1.4% 75+ 3,269 6.8% 6.1% +0.7% 2012 census estimates in the different age groups in the Secondary Service Area. % of Total: Percentage of the Secondary Service Area population in the age group. National Population: Difference: Percentage of the national population in the age group. Percentage difference between the Secondary Service Area population and the national population. Chart H 2012 Secondary Service Area Age Group Distribution 30 25 20 15 10 5 0-5 5-17 yrs 18-24 25-44 45-54 55-64 65-74 75+ Secondary Service Area National Page 21

MARKET ANALYSIS The demographic makeup of the Secondary Service Area, when compared to the characteristics of the national population, indicates that there are some differences with an equal or larger population in the -5, 5-17, 65-74 and 75+ age groups and a smaller population in the 18-24, 25-44, 45-54 and 55-64 age groups. The largest positive variance is in the 5-17 age groups with +2.0%, while the greatest negative variance is in the 25-44 age groups with -2.5%. Page 22

MARKET ANALYSIS Population Distribution Comparison by Age: Utilizing census information from the Secondary Service Area, the following comparisons are possible. Table L 2012 Secondary Service Area Population Estimates (U.S. Census Information and ESRI) Ages 2010 Census 2012 Projection 2017 Projection Percent Change Percent Change Nat l -5 3,733 3,763 3,960 +6.1% +4.7% 5-17 9,323 9,253 9,667 +3.7% +1.8% 18-24 4,397 4,449 4,372-0.6% -2.4% 25-44 11,525 11,618 12,148 +5.4% +10.4% 45-54 6,375 6,284 6,134-3.8% -6.2% 55-64 5,042 5,359 5,922 +17.5% +13.7% 65-74 3,954 4,313 5,504 +39.2% +32.9% 75+ 3,144 3,269 3,686 +17.2% +9.5% Chart I Secondary Service Area Population Growth 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0-5 5-17 yr 18-24 25-44 45-54 55-64 65-74 75+ 2010 2012 2017 Table-L, illustrates the growth or decline in age group numbers from the 2010 census until the year 2017. It is projected that all of the age categories except 18-24 and 45-54 will see an increase in population or static growth. It must be remembered that the population of the United States as a whole is aging and it is not unusual to find negative growth numbers in the younger age groups and significant net gains in the 45 plus age groupings in communities which are relatively stable in their population numbers. Page 23

MARKET ANALYSIS Race and Ethnicity Listed below is the distribution of the population by race and ethnicity for the Secondary Service Area for 2012 population projections. Those numbers were developed from 2010 Census Data. Table M Secondary Service Area Ethnic Population and Median Age (Source U.S. Census Bureau and ESRI) Ethnicity Total Median Age % of Population % of California Population Population Hispanic 24,540 24.7 50.8% 38.4 Table N Secondary Service Area Population by Race and Median Age (Source U.S. Census Bureau and ESRI) Ethnicity Total Population Median Age % of Population % of California Population White 30,384 45.2 62.9% 56.9% Black 2,642 27.1 5.5% 6.1% American Indian 653 30.8 1.4% 1.0% Asian 960 42.4 2.0% 13.2% Pacific Islander 107 26.8 0.2% 0.4% Other 11,470 24.5 23.7% 17.3% Multiple 2,092 21.3 4.3% 5.0% 2012 Secondary Service Area Total Population: 48,308 Residents Note: According to the United States Census Bureau, Hispanic is an ethnic group but not a race. Therefore Hispanics are also members of a race category as well. For this reason Hispanic is shown in a separate table and the totals for Table H and I will not add up to 100%. Page 24

MARKET ANALYSIS Chart J Secondary Service Area Non-White Population by Race 2.0% 0.20% 1.4% 5.5% 4.3% 23.7% Black American Indian Asian Pacific Islander Other Multiple Tapestry Segments: In addition to look at the age group distribution, population growth along with ethnicity and race of the service area B*K can further examine the service area by examining the various tapestry segments. The following table outlines the top 5 tapestry segments within the Secondary Service Area and provides definitions for each of the tapestries. Table O Secondary Service Area Tapestry Segment Comparison (ESRI estimates) Secondary Service Area U.S. Households Cumulative Cumulative Percent Percent Percent Percent Industrious Urban Fringe 25.3% 25.3% 1.5% 1.5% Senior Sun Seekers 23.6% 48.9% 1.2% 2.7% City Dimensions 18.0% 66.9% 0.9% 3.6% Midlife Junction 7.7% 74.6% 2.5% 6.1% Southwestern Families 6.6% 81.2% 1.0% 7.0% Industrious Urban Fringe (38) Family is central with more than ½ of the households having children; 54% are married-couple families, 17% are single parents. Multi-generational households are common. Most work in the manufacturing, construction, retail trade and service industries. Page 25

MARKET ANALYSIS Senior Sun Seekers (49) Growing at a rate of 2.2% annually, these neighborhoods are among the fastest growing in the nation. Married couples without children and singles comprise 70% of all households. Most of these residents are white. City Dimensions (60) Diversity in household type and ethnicity characterizes these neighborhoods. Households are a mix of types; most are singles that live alone. Ethnic diversity is high. Midlife Junction (33) Nearly 20% of this group are aged 65 years or older. Households are a mix of family types and singles who live alone or share housing. Most of these residents are white. Southwestern Families (59) A mix of family types comprise 80% of the households. These young families form the foundation of Hispanic life in the Southwest. Children are the center of these households that are composed mainly of married couples with children and single-parent families. Ethnic diversity is high. Demographic Summary The following summarizes the demographic characteristics of the different service areas. The Primary Service Area at 37,297 individuals (2012 estimate) is adequate to support a significant new aquatic facility. If the Secondary Service Area population is added in, then the total market is 48,308 (2012 estimate). The population in each of the service areas is expected to increase significantly in the next five years which will add additional swimmers to the market. The population of the service areas is younger than the national number and there are expected to be strong growth numbers in the youth age groups in the coming years as well as most other age categories. Both of these factors have a positive impact on participation in swimming. There is a reasonably low median household income level in both service areas and the household expenditures for Entertainment & Recreation are only 54% of the levels for the State of California. In addition, the Recreational Spending Index is only approximately 50% of the state. This low level of discretionary income will have a negative impact on the rate of participation in swimming activities. Page 26

MARKET ANALYSIS There is a significant Hispanic population in the area and this will have a bearing on the rate of participation in swimming activities (see the next section on swimming participation). Page 27

MARKET ANALYSIS Swimming Participation On an annual basis the National Sporting Goods Association (NSGA) conducts an in-depth study and survey of how Americans spend their leisure time. This information provides the data necessary to overlay rate of participation onto the Primary Service Area to determine market potential. Comparison With National Statistics: Utilizing information from the National Sporting Goods Association 2011 Survey and comparing them with the demographics from the Primary Service Area, the following participation projections can be made (statistics were compared based on age, household income, regional population and national population). Table P Swimming Participation Rates for Primary Service Area Activity Age Income Region Nation Average Swimming 17.4% 11.3% 14.5% 16.4% 14.9% Age: Income: Region: National: Average: Participation based on individuals ages 7 & Up of the Primary Service Area. Participation based on the 2012 estimated median household income in the Primary Service Area. Participation based on regional statistics (Pacific). Participation based on national statistics. Average of the four columns. Anticipated Participation Numbers for Swimming: Utilizing the average percentage from Table-P above plus the 2010 census information and census estimates for 2012 and 2017 (over age 7) the following comparisons can be made. Table Q Participation Rates Primary Service Area Activity Average 2010 Part. 2012 Part. 2017 Part. Difference Swimming 14.9% 4,808 4,896 5,211 +402 Note: The estimated participation numbers indicated above are for swimming activities and do not translate into attendance figures for a new outdoor aquatic center within the Primary Service Area. However, these figures do indicate the total number of people participating in swimming within the Primary Service Area. Page 28

MARKET ANALYSIS Anticipated Annual Swimmer Days: Utilizing NSGA s 2011 survey information B*K can determine the average number of times each of the groups listed below participated in swimming. Once that average has been determined it can be applied to the participation numbers from Table-Q to provide an anticipated number of swimmer days within the service area. Anticipated number of swimmer days can be defined as the number of times all of the individuals within the service area will swim during a year, regardless of location or duration. Table R Anticipated Annual Swimmer Days Primary Service Area National Male Female Region Income Average 39.65 38.93 40.23 42.05 39.16 40.00 Average 2010 Part. 2012 Part. 2017 Part. Difference 40.00 192,357 195,874 208,450 +16,093 This is an average number of swimmer days that are available in the Primary Service Area. In addition to developing a unique participation percentage for the Primary Service Area and looking at the number of swimmer days, B*K also examines the frequency of participation in swimming activities according to the 2011 NSGA Survey. The chart below outlines that data. Table S Participation Frequency Frequent Occasional Infrequent Swimming Frequency 110+ 25-109 6-24 Swimming Percentage of Population 5.6% 46.1% 48.4% In the chart above one can look at each activity and how it is defined with respect to visits being Frequent, Occasional or Infrequent and then the percentage of population that participates. Page 29

MARKET ANALYSIS Table T Participation Numbers Frequent Occasional Infrequent Total Swimming 112 67 15 Population 274 2,257 2,370 Visits 30,688 151,219 35,550 217,457 The table above takes the frequency information one step further and identifies the number of times an individual may participate in swimming, applies the percentage from Table-S to the population in Table-Q and then gives a total number of aquatic facility visits. Those visits are not specific to one facility, but rather specific to the Primary Service Area population. Participation by Ethnicity and Race: Participation in sports activities is also tracked by ethnicity and race. The table below compares the overall rate of participation in swimming nationally with the rate for Hispanics and African Americans. Utilizing information provided by the National Sporting Goods Association's 2011 survey, the following comparisons are possible. Table U Comparison of National, African American and Hispanic Participation Rates Primary Service Area National Participation African American Participation Hispanic Participation Swimming 14.9% 16.4% 6.8% 12.9% Primary Service Part: National Rate: The unique participation percentage developed for the Primary Service Area. The national percentage of individuals who participate in the given activity. African American Rate: The percentage of African Americans who participate in the given activity. Hispanic Rate: The percentage of Hispanics who participate in the given activity. Based on the fact that there is a significant Hispanic population in the Primary Service Area those participation rates become more relevant to the impact on overall participation percentages. Page 30

MARKET ANALYSIS Summary of Sports Participation: The following chart summarizes participation in both indoor and outdoor activities utilizing information from the 2011 National Sporting Goods Association survey. Table V Sports Participation Summary Sport Nat l Rank 4 Nat l Participation (in millions) Primary Service Area Primary Service Area % Participation Exercise Walking 1 95.8 1 28.5% Exercising w/ Equipment 2 55.3 2 18.4% Swimming 3 51.9 3 14.9% Aerobic Exercising 5 38.5 4 13.9% Running/Jogging 8 36.3 5 13.5% Workout @ Club 10 35.5 6 11.2% Weightlifting 12 31.5 7 9.9% Basketball 14 26.9 8 8.6% Yoga 15 20.2 9 7.6% Billiards/Pool 17 21.6 10 6.5% Volleyball 29 20.0 11 3.4% Nat l Rank: Nat l Participation: Primary Service %: Popularity of sport based on national survey. Percent of population that participate in this sport on national survey. Ranking of activities based upon average for each sport. Primary Service Rank: The rank of the activity within the Primary Service Area. It is significant that swimming is ranked 3 rd in the rate of participation compared to other sports both nationally and within the Primary Service Area. 4 This rank is based upon the 51 activities reported on by NSGA in their 2010 survey instrument. Page 31

MARKET ANALYSIS Comparison of State Statistics with National Statistics: Utilizing information from the National Sporting Goods Association, the following charts illustrate the participation numbers in selected sports in the State of California. State of California participation numbers in selected indoor and outdoor sports - As reported by the National Sporting Goods Association in 2011. Table W California Participation Rates Sport California Participation Age Group Largest Number (in thousands) Exercise Walking 11,384 65-74 45-54 Exercising w/ Equipment 5,905 25-34 25-34 Swimming 4,707 7-11 7-11 Aerobic Exercising 4,934 35-44 25-34 Running/Jogging 5,167 12-17 25-34 Workout @ Club 4,224 25-34 25-34 Weightlifting 3,488 25-34 25-34 Basketball 2,893 7-11 12-17 Yoga 2,726 25-34 25-34 Billiards/Pool 1,771 25-34 25-34 Volleyball 1,078 12-17 12-17 CA Participation: Age Group: Largest Number: The number of people (in thousands) in California who participated more than once in the activity in 2012 and are at least 7 years of age. The age group in which the sport is most popular or in other words, where the highest percentage of the age group participates in the activity. (Example: The highest percent of an age group that participates in exercise walking is 55-64.) This is a national statistic. The age group with the highest number of participants. Example: The greatest number of exercise walkers is in the 45-54 age group. (Note: This statistic is driven more by the sheer number of people in the age group than by the popularity of the sport in the age span.) This is a national statistic. Within the State of California swimming is the fifth most popular activity compared to its ranking of third nationally and within the Pacific region of the country. Page 32

MARKET ANALYSIS California sport percentage of participation compared with the population percentage of the United States: California s population represents 12.0% of the population of the United States (based on 2012 Estimates). Table X California Participation Correlation Sport Participation Percentages Running/Jogging 13.4% Yoga 12.6% Workout @ Club 12.2% Weightlifting 12.0% Exercise Walking 11.7% Aerobic Exercising 11.7% Basketball 11.1% Volleyball 10.7% Exercising w/ Equipment 10.6% Swimming 10.2% Billiards/Pool 8.9% Note: Sports participation percentages refer to the total percent of the national population that participates in a sport that comes from the State of California s population. It is important to realize that the rate of swimming participation is lower than the percentage of the national population indicating that this is not as popular a sport as in other areas of the country. Page 33

MARKET ANALYSIS In addition to examining the participation numbers for swimming through the NSGA 2011 Survey and the Spending Potential Index for Entertainment & Recreation B*K can access information about Sports & Leisure Market Potential. The following information illustrates participation rates for adults in various activities in the Primary Service Area. Table Y Market Potential Index for Adult Participation in Activities Primary Service Area Expected Percent of MPI Adults participated in: Number of Adults Population Swimming 4,644 17.8% 91 Expected # of Adults: Percent of Population: Number of adults, 18 years of age and older, participating in the activity. Percent of the service area that participates in the activity. MPI: Market potential index as compared to the national number of 100. This table indicates that the overall propensity for adults to participate in the various activities listed is lower than the MPI number of 100. Page 34

MARKET ANALYSIS Map F Adult Swimming Participation Page 35

MARKET ANALYSIS Below are listed selected sports activities and the percentage of growth or decline that each has experienced nationally over the last 10 years (2002-2011). Table Z National Activity Trend (in millions) Sport/Activity 2011 Participation 2002 Participation Percent Change Lacrosse 5 2.7 1.2 125.0% Yoga 6 21.6 10.7 101.9% Running/Jogging 38.7 24.7 56.7% Aerobic Exercising 42.0 29.0 44.8% Workout @ Club 34.5 28.9 19.4% Tennis 13.1 11.0 19.1% Exercising w/ Equipment 55.5 46.8 18.6% Exercise Walking 97.1 82.2 18.1% Weightlifting 29.1 25.1 15.9% Football (tackle) 9.0 7.8 15.4% Soccer 13.9 13.7 1.5% Basketball 26.1 28.9-9.7% Volleyball 10.1 11.5-12.2% Swimming 46.0 53.1-13.4% Baseball 12.3 15.6-21.2% Softball 10.4 13.6-23.5% Skateboarding 6.6 9.7-32.0% 2011 Participation: The number of participants per year in the activity (in millions) in the United States. 2002 Participation: The number of participants per year in the activity (in millions) in the United States. Percent Change: The percent change in the level of participation from 2002 to 2011. While a decrease in National Swimming Participation is not consistent with the positive growth USA Swimming has experienced in the past 5-10 years it must be remembered that these numbers provide a national perspective. 5 For Lacrosse the NSGA only has statistical data dating back to 2007, so the increase of 125% is from 2007-2011. 6 For Yoga the NSGA only has statistical data dating back to 2007, so the increase of 101.9% is from 2007-2011. Page 36

MARKET ANALYSIS Below is listed the growth or decline in swimming that has occurred nationally from 2001-2010. Table AA Swimming Participation (in millions) Year Total Participation 2001 54.8 2002 53.1 2003 52.3 2004 53.4 2005 58.0 2006 56.5 2007 52.3 2008 53.5 2009 50.2 2010 51.9 Chart K Swimming Participation (in millions) 58 56 54 52 50 48 46 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Participation in Millions Page 37

MARKET ANALYSIS Aquatic Participation Trends: Without doubt the hottest trend in aquatics is the leisure pool concept. This idea of incorporating slides, lazy rivers (or current channels), fountains, zero depth entry and other water features into a pool s design has proved to be extremely popular for the recreational user. The age of the conventional pool in most recreational settings is virtually obsolete. Leisure pools appeal to the younger kids (who are the largest segment of the population that swims) and to families. These types of facilities are able to attract and draw larger crowds and people tend to come from a further distance and stay longer to utilize such pools. This all translates into the potential to sell more admissions and increase revenues. It is estimated conservatively that a leisure pool can generate up to 30% more revenue than a comparable conventional pool and the cost of operation while being higher, has been offset through increased revenues. Of note is the fact that patrons seem willing to pay a higher user fee with this type of pool than a conventional aquatics facility. However, most all indoor leisure pools still cannot cover their cost of operation from user fees. Despite the recent emphasis on recreational swimming the more traditional aspects of aquatics (including competitive swimming, water polo, synchronized swimming, diving, lessons/instruction, and aqua fitness) remain as a part of most aquatic centers. The life safety issues associated with teaching children how to swim is a critical concern in most communities and competitive aquatic programs continue to be important. The family oriented outdoor water park concept of delivering aquatics services continues to grow in acceptance with the idea of providing for a variety of interactive aquatics activities and programs in a park like setting that features a lot of grass, shade structures, sand play areas and natural landscapes. This idea has proven to be financially successful by centralizing pool operations for communities and through increased generation of revenues from patrons willing to pay for an aquatics experience that is new and exciting. These outdoor water parks have become identifiable centers for communities and have promoted family recreation values. The keys to success for this type of center revolve around the concept of intergenerational use in a quality facility that has an exciting and vibrant feel in a park like setting. A new concept is the spray ground, where a number of water spray features are placed in a playground setting where there is no standing water but the water is treated and recirculated much like a pool. This provides a fun, yet safe, environment where drowning is not a concern and lifeguards are not necessary. Also changing is the orientation of aquatic centers from stand alone facilities that only have aquatic features to more of a full-service recreation center that has fitness, sports and community based amenities. This change has allowed for a better rate of cost recovery and stronger rates of use of the aquatic portion of the facility as well as the other dry side amenities. Page 38

MARKET ANALYSIS Swimming is third only to walking and exercising with equipment in popularity of sports and leisure activities, meaning that there is a significant market for aquatic pursuits. Approximately 14.5% of the population in the Pacific region of the country participates in aquatic activities. This indicates that there is a large segment of the population that participates in aquatics activities. Within the state of California, swimming is the number four most participated in sports activity. Aquatic Facilities Market Orientation Based on the aquatic trends and typical aquatic needs within a community, there are specific market areas that need to be addressed with aquatic facilities. These include: 1. Leisure/recreation aquatic activities - This includes a variety of activities found at leisure pools with zero depth entry, warm water, play apparatus, slides, seating areas and deck space. These are often combined with other non-aquatic areas such as concessions and birthday party or other group event areas. 2. Instructional programming - The primary emphasis is on teaching swimming and lifesaving skills to many different age groups. These activities have traditionally taken place in more conventional pool configurations but should not be confined to just these spaces. Reasonably warm water, shallow depth with deeper water (4 ft. or more), and open expanses of water are necessary for instructional activities. Easy pool access, a viewing area for parents, and deck space for instructors is also crucial. 3. Fitness programming - These types of activities continue to grow in popularity among a large segment of the population. From aqua exercise classes, to lap swimming times, these programs take place in more traditional settings that have lap lanes and large open expanses of water available at a 3 1/2 to 5 ft. depth. 4. Competitive swimming/diving - Swim team competition and training for youth, adults and seniors requires a traditional 6 to 10 lane pool with a 1 and/or 3 meter diving boards at a length of 25 yards or 50 meters. Ideally, the pool depth should be no less than 4 ft. deep (7 is preferred). Spectator seating and deck space for staging meets is necessary. This market is usually relatively small in number but very vocal on the demands for competitive pool space and time. 5. Specialized uses Activities such as water polo and synchronized swimming can also take place in competitive pool areas as long as the pool is deep enough (7 ft. minimum) and the pool area is large enough. However these are activities that have small participant numbers and require relatively large pool areas. As a result it may be difficult to meet the needs of all specialized uses on a regular basis. Page 39

MARKET ANALYSIS 6. Social/relaxation - The appeal of using an aquatics area for relaxation has become a primary focus of many aquatic facilities. This concept has been very effective in drawing non-swimmers to aquatic facilities and expanding the market beyond the traditional swimming boundaries. The use of natural landscapes and creative pool designs that integrate the social elements with swimming activities has been most effective in reaching this market segment. 7. Special events/rentals - There is a market for special events including kids birthday parties, corporate events, community organization functions, and general rentals to outside groups. The development of this market will aid in the generation of additional revenues and these events/rentals can often be planned for after or before regular hours or during slow use times. It is important that special events or rentals not adversely affect daily operations or overall center use. Specific market segments include: 1. Families - Within almost any market, an orientation towards family activities is essential. The ability to have family members of different ages participate in a fun and vibrant facility is essential. 2. Pre-school children - The needs of pre-school age children need to be met with very shallow water which is warm and has play apparatus designed for their use. Interactive programming involving parents and toddlers can also be conducted in more traditional aquatic areas as well. 3. School age youth - A major focus should be to meet the needs of this age group from recreational swimming to competitive aquatics. The leisure components such as slides, fountains, lazy rivers and zero depth will help to bring these individuals to the pool on a regular basis for drop-in recreational swimming. The lap lanes provide the opportunity and space necessary for instructional programs and aquatic team use. 4. Teens - Another aspect should be meeting the needs of the teenage population. Serving the needs of this age group will require leisure pool amenities that will keep their interest (slides) as well as the designation of certain teen times of use. 5. Seniors - As the population of the United States and the Desert Hot Springs area continues to age, meeting the needs of an older senior population will be essential. A more active and physically oriented senior is now demanding services to ensure their continued health. Aqua exercise, lap swimming, therapeutic conditioning and even learn to swim classes have proven to be popular with this age group. Page 40

MARKET ANALYSIS 6. Special needs population - This is a secondary market, but with the A.D.A. requirements and the probable existence of shallow warm water and other components, the amenities are present to develop programs for this population segment. Association with a hospital and other therapeutic and social service agencies will be necessary to enhance this market. 7. Special interest groups - This is a market that needs to be explored to determine the use potential from a variety of groups. These could include swim teams (and other aquatic teams), school district teams, day care centers and social service organizations. 8. Visitors/Seasonal residents The Coachella Valley and the greater Desert Hot Springs area attracts a large number of annual visitors as well as seasonal residents. Attracting these individuals to the aquatic center will be essential. This group has a variety of needs from recreational swimming to fitness. Aquatics Participation Summary: The following is a brief summary of the possible aquatic participation rates for swimming. Swimming is the number 3 most popular sport nationally as well as in the service areas. The overall popularity of swimming has declined by approximately 13% in the last 10 years. The age group with the highest rate of participation in swimming is 7-11. The rate of participation in swimming is approximately 14.9% of the population over age 7 in the Primary Service Area. There are estimated to be approximately 195,874 swimmer days available in the Primary Service Area (in 2012) and the rate is expected to grow at a steady in the coming years. Slightly more than 46% of all swimmers swim more than 24 times a year but only 5.6% swim 110 times or more. This means that most swimmers are recreational swimmers rather than competitive. California has a slightly lower rate of participation in swimming than other states. Page 41

MARKET ANALYSIS Outdoor Aquatic Facilities Inventory: There are a variety of outdoor aquatic facilities that currently serve the greater Desert Hot Springs market area but virtually none of these facilities are located in the Primary or Secondary Service Areas. These facilities vary from municipal pools to school facilities, country clubs, HOA s, private water parks, resort hotels, and backyard pools. Public Sector Providers These facilities will be the primary competition for the new John H. Furbee Aquatic Center as they have a similar market focus. It is significant that there are only four such pools in the area. They include: Palm Springs Swim Center This is a 50 meter pool that is owned and operated by the City of Palm Springs. This is one of two true public competitive pools in the area but it does not have any recreational amenities. The pool is open year round, is in good condition, and the user rates are very affordable. The Piranha s Swim Team utilizes the pool for practices and meets. Palm Desert Aquatic Center This center is owned by the City of Palm Desert but operated by the Family YMCA of the Desert. The facility opened in 2011 and features three pools, a 50 meter by 25 yard competition pool; a 25 yard recreation pool with shallow, warm water, and two slides; and a splash playground. The center is open year round and is the most comprehensive public pool in the Coachella Valley. Page 42

MARKET ANALYSIS Pawley Aquatic Complex Located well outside of the Desert Hot Springs area in Indio, this small facility features a 6 lane pool with two drop slides at one end, a wading pool, and a small spray pad. It is owned and operated by the Desert Recreation District. The complex is generally a seasonal facility but is used year round by the Desert Terrapins Aquatic Club for practices. The complex is older but has been renovated. The rates are very affordable. Fritz Burns Community Pool This is a six lane pool that is a seasonally operated facility that is owned by the City of La Quinta but operated by the YMCA. It is a small pool that has no recreational amenities. School Pools Three high schools in the immediate area have competitive pools but these are not generally utilized by outside groups due to the high cost of rentals. There is also no open public use. The local high school pools include Palm Desert High School, La Quinta, and Shadow Hills. Page 43

MARKET ANALYSIS Private Sector Providers The other major provider of aquatic facilities is the private sector and there is a wide range of pools in the Coachella Valley but most are not located in the Desert Hot Springs market. With limited access and facilities that focus on residents of a development or visitors to the area, these are not aquatic centers that will be direct competition for the John H. Furbee Aquatic Center. The private pools can be put into five basic categories. Home Owners Associations These tend to be smaller and more conventional pools that are designed to serve a very specific housing area or development. As a result they have a very different market appeal than a public center. Country Clubs These are pools that have been developed to support members of private clubs and their guests. Most of these pools are also traditional rectangular pools with limited appeal to the recreational swimmer. Resort Hotels There are a variety of resort hotels in the Coachella Valley and all of them have some type of outdoor pool. Many are smaller conventional pools but several larger and more sophisticated aquatic facilities are also present that have a strong appeal to the recreational swimmer and more specifically visitors to the area. These pools are only available to hotel guests. Water Parks There is one major water park in the area. Soak City is located in Palm Springs and is a large facility that caters to the recreational swimmer with slides, lazy rivers, wave pool, and other recreational amenities. Such facilities have very expensive user fees and most individuals only visit this type of facility a handful of times during a season. This facility serves both locals and visitors to the Coachella Valley. This facility also has a very different market focus than a public aquatic center. Page 44

MARKET ANALYSIS Backyard Pools Many residents of the area have pools in their back yards but the vast majority of these are small, with very limited uses and amenities. Most of the homes in Desert Hot Springs do not have their own pools however. Market Opportunities - Based on the other aquatic facilities located in the Coachella Valley, the following are market opportunities for the John H. Furbee Aquatic Center. The existing Wardman Park Pool is in need of being replaced. It is limited in size and lacks the appeal of new aquatic facilities. There are really no other public pools in the market area and very limited private sector providers. The new aquatic center can serve a variety of competitive aquatic needs. The new aquatic center is a beautiful facility that will be very attractive to users. Operating the aquatic center in conjunction with the Health & Wellness Center and Boys & Girls Club will provide additional markets for the pool. With the conventional nature of the facility, it will need to serve more as a program based pool. It will be critical to attract other user groups outside of Desert Hot Springs proper (swim teams, etc.) that will be willing to pay for use. Marketing the aquatic center to the larger market area, visitors to the community as well as the second homeowner will increase the use and potential revenue for the facility. Market Constraints In addition to the market opportunities, it is also important to analyze possible market constraints. These include. Despite a very limited competitive swimming and water polo market in Desert Hot Springs, a pool to serve these needs is the primary focus of the facility. With deep water and a very conventional shape, there is limited appeal to recreational swimmers (even with the splash pad). It will be very difficult to draw users from beyond the Secondary Service Area, especially with the number of other aquatic opportunities that are available in the Coachella Valley. Page 45

MARKET ANALYSIS Summer weather can be too hot for people to even use a pool during afternoon times especially. This problem is exacerbated by the lack of a cooling system for the pool water itself. The Primary Service Area has only an adequate number of inhabitants with a lower household income rate, and a significant Hispanic population. These characteristics contribute to a reduced rate of aquatic use and the need for a greater focus on recreational swimming to attract the more casual user than what the facility currently has to offer. To be financially viable the John H. Furbee Aquatic Center will need to have a focus not only on traditional aquatic activities (lap swimming, competitive swimming, lessons and fitness) but also on recreational swimming (as best it can). There will also need to be a high level of aquatic programming offered as well. As has been noted earlier, there are estimated to be 195,874 swimmer days in the Primary Service Area and if the new aquatic center were able to attract 20% of these available swimmer days (a reasonable figure) this would convert to 39,175 swimmer days (this includes all types of swimming activities, not just paid admissions). This is a reasonably low number of swimmer days that could be augmented by further participation from outside the Primary Service Area as well as from visitors and second homeowners. Project Recommendations: Realizing that the John H. Furbee Aquatic Center is nearing completion, the basic amenities and configuration of the facility has already been determined. However to maximize the market opportunities noted above while at the same time minimizing the constraints, the following recommendations are recommended. The facility should not open to the general public until Memorial Day 2013. A management and operations contract needs to be signed as soon as possible with an agency that has experience operating public pools in the Coachella Valley. The aquatic center should be open to the general public on a seasonal basis only (Memorial Day to Labor Day) and any organizational use beyond this season should require the payment of a market driven user fee. The Palm Springs Unified School District should be charged for any use of the aquatic center based on the established fee schedule. The existing Wardman Park Pool should be permanently shut down once the John Furbee Aquatic Center opens. Page 46

MARKET ANALYSIS The access and use of the playground during the time that the aquatic center is open will need to be determined. A learn to swim program for all 4 th graders in the City should be established with funding from an outside agency or grant. The City will need to plan for the possible addition of more shade to the pool deck, the establishment of an area for birthday parties, and the addition of a possible cooling system for pool water. A temporary system to raise the level of the shallow end of the pool to less than 3 feet should be explored to enhance recreational swimming and provide an area for beginner swim lessons (the current pool is too deep to be effective for these uses). All aquatic center promotional and marketing information should be published in both English and Spanish. Page 47

OPERATIONS ANALYSIS Section II Benchmark Facilities In order to better understand not only the market for the new John Furbee Aquatic Center but also the characteristics that make for a successful outdoor swimming center, a benchmark study of four aquatic centers in southern California has been undertaken. These four facilities were chosen with input from staff and represent three key existing facilities in the Coachella Valley, as well as one other aquatic center that is well outside of the market area. The four benchmark aquatic facilities are: Palm Springs Swim Center Pawley Aquatic Complex Valley-Wide Aquatic Center Palm Desert Aquatic Center It should be noted that three of these facilities are larger than the John Furbee Aquatic Center and more diverse in their amenities. Only the Pawley Aquatic Complex is similar in nature. Palm Springs Swim Center Owner/Operator: City of Palm Springs Contact: Athena Huss Address: 405 S. Pavilion Way, Palm Springs, CA 92262 Website: http://www.palmsprings-ca.gov/index.aspx?page=786 Phone Number: (760) 323-8278 E-Mail(s): Athena.huss@palmsprings-ca.gov Season/Hours of Operation: Year round operation Adult Lap Swim Mon-Fri; 5:30-8:30A, 11:00A-6:30P Sat & Sun; 7:00A-3:00P Recreational Swim Periods Mon-Fri; 11:00A-5:00P Sat-Sun; 11:00A-3:00P Facility Description: Number of pools; 1, 50M x 25Y pool, heated Amenities; locker rooms, diving boards Concession; yes and self-operated Page 48

OPERATIONS ANALYSIS User Fees: Daily; Resident: $4.00 (adult), $3.00 (4-12), free (under 3) Non-Resident: $5.00 (adult) Punch Card; Resident: $60 Non-Resident: $70 Rentals; $43/hr plus $1.00/adult 13 & Up, $.50/child 4-12 Operations Budget: Expenditures; 2008-2009 Actual - $181,072 Note: This only includes 1 full time professional staff member, 2 full time lifeguards and a heating cost estimate. It does not include part time lifeguards or additional operating expenses. Thus, it is safe to assume this number is significantly greater. Staffing plan and wages; Aquatic Supervisor (1) - $64,160 Full Time Lifeguards (2) - $104,912 Revenues; 2008-2009 Actual - $91,847 Programs and Services Offered: Lap Swim, Family Swim, Aquatic Exercise Program, Swim Classes (contracted through AB Splash), Over-Night Camping, Adult Fitness Swim Page 49

OPERATIONS ANALYSIS Pawley Pool Family Aquatic Complex Owner/Operator: Desert Recreation District Contact: Jeff Ronci, Aquatics Coordinator Address: 46350 Jackson St., Indio, CA 92201 Website: http://www.myrecreationdistrict.com/activities/swim-and-the-water-activites Phone Number: (760) 775-1945 E-mail: jronci@drd.us.com Season/Hours of Operation: Lap Pool, Year round operation Adult Lap Swim; Mon, Wed, Fri 5:45A-7:30A Tue, Thu 7:30-8:30A Sat 9:00-11:00A Open Swim (seasonal); (Spring Break) Noon-3:30P April 17-June 5 Noon-3:30P Facility Description: Number of pools; 1, 6 lane 25Y lap pool (heated); 1, 50 x 40 instructional pool (not heated), splash pad w/various water features (not heated) Amenities; locker rooms, 2 water slides Concession; yes, self-operated Bather load; 325-350 per day User Fees: Open Swim; $4.00/adult, $3.00/child, seasonal pass $25.00/person Lap Swim; $3.00/adult, $50 for 25 visits, $75 for 50 visits, $100 for 100 visits Pool Parties; Small Party, 1-10 Kids, $35/hr + $4/child Medium Party, 11-17 Kids, $45/hr + 3/child Large Party, 18-25 Kids (MAX), $55/hr +$2/child Pool Rentals; 2 Hour Minimum for All; 1-40 People $80/hr, 41-60 People $90/hr, 61-80 People $100/hr, 81-100 People $110/hr, 101 & Over $125/hr Page 50

OPERATIONS ANALYSIS Operations Budget: (expenses take into account a portion of full time salary which is spread throughout all facilities) Expenses: FY 08/09, Actual $283,252.40 FY 09/10, Projected $353,422.00 Revenues: FY 08/09, Actual $107,632.00 FY 09/10, Projected $125,532.00 Cashier: $10.23-11.84/hr Lifeguard: $10.25-12.05/hr Instructor: $12.25-13.25/hr Pool Manager: $12.10-15.50/hr Programs and Services Offered: Lap Swimming, Private Swim Lessons, Swim School, Recreational Swimming, Pool Rentals, Basic Water Rescue, Lifeguard Training, Adult Swim Lessons Page 51

OPERATIONS ANALYSIS Valley-Wide Aquatic Center Owner/Operator: Valley Wide Recreation & Park District Contact: Missy Galloway Address: 1810 Searl Parkway, Hemet, CA 92544 Website: www.vwrpd.org/hemet-aquatic-center.cfm Phone Number: (951) 929-0047 Season/Hours of Operation: Seasonal Operation Month of May, weekends only 11:00A-Noon Lap Swim Noon-5:00P Open Swim June 15 th through end of season, 7 days a week 12:30P-4:30P Open Swim Pre-Noon Swim Lessons & Other Programming Post-5:00P Swim Lessons & Other Programming Facility Description: Number of pools; 1, 25Y heated pool, Amenities; zero depth entry, water fountain sprayers Concession; yes and self-operated Bather Load; 376 User Fees: Daily; $7.00/Adult (ages 3-55), $6.00/Seniors, $2.00/Kids (under 2) Lap Swim; $2.00/Person Operations Budget: Expenditures: 08/09 Actual $398,463.79 09/10 Partial $297,528.00 Staffing plan and wages; Lifeguards $8.50/hr WSI Certification $10.00/hr Pool Manager $12.00-17.00/hr Revenues; 08/09 Actual $308,017.08 09/10 Partial $211,148.00 Page 52

OPERATIONS ANALYSIS Programs and Services Offered: Group Swim Lessons, Private Swim Lessons, Junior Lifeguard Program, Come Swim w/ Me (8 & Under), Little Swimmers, Movie Night at the Aquatic Center, Water Polo, Family Fun Night/Ice Cream Social, 4 th of July Party, Labor Day Party Page 53

OPERATIONS ANALYSIS Palm Desert Aquatic Center Owner: Operator: Contact: City of Palm Desert YMCA of the Desert Karen Creasey, Aquatic Supervisor (YMCA) Address: 73751 Magnesia Falls Dr., Palm Desert, CA 92260 Website: www.pdpool.com www.cityofpalmdesert.org/index.aspx?page=611 Phone Number: (760) 565-7467 E-Mail(s): kcreasey@desertymca.org Season/Hours of Operation: Year round operation Spring: Mon-Fri: 5:30A-8:00P Summer: Mon-Fri: 5:30A-8:00P Sat: 7:00A-5:00P Sat: 7:00A-8:00P Sun: 8:00A-5:00P Sun: 8:00A-8:00P Facility Description: Number of pools; 1, 50M x 25Y pool, heated; 25 yard recreation pool; Splash Playground Amenities; locker rooms, diving boards, multi-use room Concession; yes and self-operated User Fees: Resident Non-Resident Adult (13-59) $4.00 $6.00 Youth/Senior (6-12 & 60+) $3.00 $4.50 Junior (2-5) $2.50 $3.75 Adult Punch Card 25 $94.00 $142.00 Youth Punch Card 25 $65.00 $98.00 Adult 3 Month Pass $150.00 $225.00 Youth 3 Month Pass $110.00 $165.00 Adult Annual Pass $550.00 $825.00 Youth Annual Pass $420.00 $630.00 Monthly Fitness Pass $75.00 $100.00 Page 54

OPERATIONS ANALYSIS Facility Rental Rates: Resident Non-Resident $7.00/lane hour 25Y short course $9.00/lane hour 50M long course Slides $75/hr $100/hr Lap Lanes & Zero Depth $75/hr $100/hr Entire Recreation Pool w/ Slides Less than 50 $150/hr $175/hr 51-75 $175/hr $200/hr 76-100 $200/hr $225/hr 101-125 $225/hr $250/hr Multi-Use Room 7 $75/hr $100/hr 50M Pool (shallow end only) $30/hr $40/hr 50M Pool (diving board only) $75/hr $100/hr 50M Pool (without/boards or blocks) $325/hr $425/hr 50M Pool (exclusive use all pool) $375/hr $500/hr Splash Playground $75/hr $100/hr Operations Budget: Lifeguards: Lead Lifeguards: Water X Instructor: Swim Instructor: Front Desk: $9.00-11.00/hr $11.00-15.00/hr $14.00-20.00/hr $9.00-10.00/hr $8.50-10.00/hr Full time aquatic staff: $38,000-$40,000 (if position is filled) Revenue 2012/2013: $620,450 Expenses 2012/2013: $1,274,871.38 Staffing: $765,991.38 Other: $508,880.00 Programs and Services Offered: Youth Swim Lessons, Adult Swim Lessons, Private Swim Lessons, Semi-Private Swim Lessons, Recreational Swim Team, Water Polo, Diving, Master Swim, Water Aerobics, Safety Training, Competitive Swim Team, Personal Fitness Training, 7 $150 security deposit due upon rental of the room. Page 55

OPERATIONS ANALYSIS Benchmark Facilities Fee Matrix: Palm Springs Swim Center Daily Admission: Resident Adult: $4.00 4-12: $3.00 Under 3: free Non-Resident Adult: $5.00 Punch Card: Resident: $60 Non-Resident: $70 Pool Rental: $43/hr plus $1.00/adult 13 & up $.50/child 4-12 Pawley Pool Family Aquatic Center Daily Admission: Open Swim Adult: $4.00 Child: $3.00 Lap Swim Adult: $3.00 Season Pass: Open Swim: $25.00/person Lap Swim 25 visits, $50 50 visits, $75 100 visits, $100 Pool Rental, 2 Hour Min. 1-40 people, $80/hr 41-60 people, $90/hr 61-80 people, $100/hr 81-100 people, $110/hr 101 & Over, $125/hr Valley-Wide Aquatic Center Daily Admission: Adult (age 3-55): $7.00 Seniors (over 55): $6.00 Kids (under 2): $2.00 Lap Swim: $2.00/person Palm Desert Aquatic Center Daily Admission: Resident: Adult (13-59): $4.00 Youth(6-12): $3.00 Senior (60+): $3.00 Junior (2-5): $2.50 Non Resident: Adult (13-59): $6.00 Youth(6-12): $4.50 Senior (60+): $4.50 Junior (2-5): $3.75 Passes/Membership: Resident Punch Card (25) Adult: $94.00 Youth: $65.00 Non-Res Punch Card (25) Adult: $142.00 Youth: $98.00 Resident 3-Month Pass: Adult: $150.00 Youth: $110.00 Non-Res 3-Month Pass: Adult: $225.00 Youth $165.00 Annual Pass Resident: Adult:$550.00 Youth: $420.00 Annual Pass Non-Res: Adult: $825.00 Youth: $630.00 Monthly Fitness Pass: Resident: $75.00 Non-Res: $100.00 Pool Rental (res. Rates only) $7.00/hr/lane 25Y $9.00/hr/lane 50M Slides: $75.00/hr Lap & Zero Depth: $75/hr Entire Rec. Pool w/ Slides: Less than 50: $150/hr 51-75: $175/hr 76-100: $200/hr 101-125: $25/hr Multi-use Room: $75/hr 50M Pool Page 56

OPERATIONS ANALYSIS Shallow Only: $30/hr Diving Only: $75/hr W/out Boards/Blocks: $325/hr Exclusive: $375/hr Benchmark Facilities Expense/Revenue Matrix: Palm Springs Swim Center Pawley Pool Family Aquatic Valley-Wide Aquatic Center Palm Desert Aquatic Center Center Expenditures Expenditures Expenditures Expenditures $181,072 (08/09 Actual) $283,252 (08/09 Actual) $353,422 (09/10 Projected) $398,464 (08/09 Actual) $297,528 (09/10 Partial) $210,044 (12/13 Projected) $328,572 (12/13 Projected) $462,218 (12/13 Projected) $1,274,871 (12/13 Projected) Revenues Revenues Revenues Revenues $91,847 (08/09 Actual) $107,632 (08/09 Actual) $125,532 (09/10 Projected) $308,017 (08/09 Actual) $211,148 (09/10 Partial) $99,195 (12/13 Projected) $116,243 (12/13 Projected) $332,658 (12/13 Projected) $620,450 (12/13 Projected) Benchmark Facilities Fee Matrix Notes: All fees have been updated with latest available promotional materials. There have been slight changes (increases) to the rate structures since the original study was conducted in 2010. Benchmark Facilities Expense/Revenue Matrix Notes: It was difficult to gather current information on the current operations budgets as some facilities were non-responsive while others indicated that the approval process for the request would take considerable time. As a point of comparison projections were built off of the 08/09 Actual budget numbers to provide 12/13 Projected budget numbers: o For expenditures a 4% increase was factored over 4 years. o For revenues a 2% increase was factored over 4 years. Page 57

OPERATIONS ANALYSIS Section III Operations Analysis The following operations analysis has been completed for the John Furbee Aquatic Center. The following are the parameters for the project. The summer of 2013 will be the first season of operation. This budget represents the first full year of operation. The center will be operated and maintained by the. The operations plan has been developed with this concept in mind. This will be a facility that is utilized by both residents of Desert Hot Springs and nonresidents. Two different operations scenarios have been developed: o Seasonal - The aquatic center will operate on a seasonal basis (Memorial Day to Labor Day) with limited use by high school swim teams and other organizations during the balance of the year. The pool will be maintained and water circulated year round. o Year Round The aquatic center will operate year round with limited hours from Labor Day to Memorial Day. In addition to these two options a basic narrative has been included regarding the feasibility of operating the aquatic center on a daily basis from Memorial Day to Labor Day with limited swim team use during the week days and public use during the weekends. Swim lessons, aqua exercise programs and other water based activities will be offered at the facility. Concessions will not be provided but vending will be available. All users of the pool will be paying market rates for use. The existing Wardman Park Pool will be closed. A reasonably aggressive approach to estimating use and revenues for the facility has been used for this pro-forma. Page 58

OPERATIONS ANALYSIS Operating Expenditures Expenditures have been formulated based on the costs that are normally included in the operating budget for such a facility. The figures are based on the size of the center, the specific components of the facility and the projected hours of operation. Actual costs were utilized wherever possible and estimates for other expenses were based on similar facilities in other areas of the country. All expenses were calculated as accurately as possible but the actual costs may be more or less based on operational philosophy, and programming considerations adopted by staff. Aquatic Center An outdoor aquatic center with a 25 yard by 25 meter pool, small splash pad, bath house, office area and other support spaces. Operation Cost Models: Personnel Seasonal Year Round Full-Time $0 $60,750 Part-Time $113,856 $146,824 TOTAL $113,856 $207,574 Commodities Seasonal Year Round Office Supplies (forms, paper) $2,000 $3,000 Chemicals (provided by Knorr ) $73,000 $93,000 Maint./Repair/Mat. $3,000 $4,000 Janitor Supplies $10,000 $15,000 Rec. Supplies (program) $2,000 $3,000 Uniforms $2,500 $3,500 Printing/Postage $5,000 $6,000 Resale Items $2,000 $2,500 Other $1,000 $1,500 TOTAL $100,500 $131,500 Page 59

OPERATIONS ANALYSIS Contractual Seasonal Year Round Utilities 8 (gas & electric) $75,000 $125,000 Water/Sewer $10,000 $12,000 Insurance (Prop. & Liab.) $20,000 $25,000 Communications (phone) $1,000 $1,000 Contract Services 9 $20,000 $25,000 Rental Equipment $1,000 $1,000 Advertising $5,000 $8,000 Training $1,000 $1,500 Conference $500 $500 Membership/Dues/Subscriptions $500 $500 Trash Pickup $2,000 $3,000 Bank Charges $500 $1,000 Other $2,000 $3,000 TOTAL $138,500 $206,500 Capital Seasonal Year Round Replacement Fund 10 $3,000 $5,000 TOTAL $3,000 $5,000 Summary All Categories Seasonal Year Round Personnel $113,856 $207,574 Commodities $100,500 $131,500 Contractual $138,500 $206,500 Capital $3,000 $5,000 GRAND TOTAL $355,856 $550,574 Note: Line items not included in this budget are any vehicle costs. 8 It should be noted that at the time of this report utility rates were very volatile and could result in a higher energy rate for the aquatic center once it opens. 9 Contract services cover security $5,000, mechanical systems work $6,000 and the Knorr preventative maintenance contract $9,000. Year Round operating costs will be higher. 10 This is yearly capital funding for equipment replacement and other similar items. This funding will not cover major capital improvements. Page 60

OPERATIONS ANALYSIS Staffing Levels: Seasonal Year Round Full-Time Positions Positions Total Positions Total Aquatic Center Manager 0 $45,000 1 $45,000 Benefits (35%) $0 $15,750 TOTAL 0 F.T.E. $0 1 F.T.E. $60,750 Page 61

OPERATIONS ANALYSIS Seasonal Year Round Part-Time Positions Hours Weeks Hours Weeks Center Manager $17.00 Winter/Spring/Fall 23 38 10 38 Summer (high season) 40 10 41 10 Summer (low season) 40 4 12 4 Lead Lifeguard $13.00 Winter/Spring/Fall 18 38 35 38 Summer (high season) 83 10 83 10 Summer (low season) 40 4 40 4 Lifeguard $10.00 Winter/Spring/Fall 18 38 45 38 Summer (high season) 204 10 204 10 Summer (low season) 80 4 80 4 Cashier $9.50 Winter/Spring/Fall 0 38 35 38 Summer (high season) 83 10 83 10 Summer (low season) 40 4 40 4 Custodian/Grounds $10.00 Winter/Spring/Fall 6 38 9 38 Summer (high season) 14 10 14 10 Summer (low season) 9 4 9 4 Program Instructors 11 Aquatics Variable Variable $13,480 Variable $21,150 Salaries $103,505 $133,476 Benefits (10%) $10,351 $13,348 TOTAL $113,856 $146,824 Note: Pay rates were determined based on comparable wage scales in the area. The positions listed are necessary to ensure proper staffing for the center s operation as well as provide for basic programming for the facility. The wage scales for the part-time staff positions reflect an anticipated wage for 2013. 11 Program instructors are paid at several different pay rates and some are also paid per class or in other ways. This makes an hourly breakdown difficult. Aquatic programs consist of learn to swim, fitness, CPR, and other activities. Page 62

OPERATIONS ANALYSIS Revenues The following revenue projections were formulated from information on the specifics of the project and the demographics of the service area as well as comparing them to local statistics, other similar facilities and the competition for aquatic services in the area. Actual figures will vary based on market stratification, philosophy of operation, fees and charges policy, and priorities of use. Revenue Projection Models: Fees Seasonal Year Round Daily Admissions $14,400 $30,000 10 Admissions $5,900 $8,000 Season/3 Month Passes 12 $17,750 $17,750 Annual Passes $0 $17,000 Corporate/Group $5,000 $7,000 Rentals 13 $15,500 $22,000 School District Rental 14 $8,520 $8,520 TOTAL $67,070 $110,270 Programs 15 Seasonal Year Round Aquatics $27,600 $47,030 Contract $500 $750 TOTAL $28,100 $47,780 12 Figures are based on an active program to promote the sale of 3 month passes. 13 Rentals Seasonal Splash Pool $30 /hr x 20hrs = $600 Compt. Pool Other organizations (masters, club, etc.) 6 lanes x $6/lane x 8hrs/wk x 36 wks = $10,368 Meets 3 meets x $500/Day x 3 Days = $4,500 Year Round Splash Pool $30 /hr x 25hrs = $750 Compt. Pool Other organizations (masters, club, etc.) 6 lanes x $6/lane x 8hrs/wk x 48 wks = $13,824 Meets 5 meets x $500/Day x 3 Days = $7,500 14 School District Rental 2hrs/day x 5days/wk x 17wks/yr x $6lane/hr x 6 lanes = $6,120 Meets 8 x 4hrs x $75/hr. = $2,400 15 Figures are based on assessing fees that are listed later in the report. Page 63

OPERATIONS ANALYSIS Other Seasonal Year Round Resale Items (150% of cost) $3,000 $3,750 Special Events $1,000 $1,000 Vending $3,000 $4,000 TOTAL $7,000 $8,750 Revenue Summary All Categories Seasonal Year Round Fees $67,070 $110,270 Programs $28,100 $47,780 Other $7,000 $8,750 GRAND TOTAL $102,170 $166,800 Page 64

OPERATIONS ANALYSIS Expenditure - Revenue Comparisons Category Seasonal Year Round Expenditures $355,856 $550,574 Revenues $102,170 $166,800 Difference (253,686) (383,774) Recovery % 29% 30% It should be noted that the financial performance of an outdoor aquatic center is directly related to the weather. This operations pro-forma was completed based on the best information available, and a visit to the new facility, and a basic understanding of the project. As a result there is no guarantee that the expense and revenue projections outlined above will be met as there are many variables that affect such estimates that either cannot be accurately measured or are not consistent in their influence on the budgetary process. Future Years: Expenditure - Revenue Comparison: Expenses for the first year of operation of the pool should be slightly lower than projected with the facilities being under warranty and new. Revenue growth in the first three years is attributed to increased market penetration and in the remaining years to continued population growth. In most aquatic facilities the first three years show tremendous growth from increasing the market share of patrons who use such facilities, but at the end of this time period revenue growth begins to flatten out. Additional revenue growth is then spurred through increases in the population within the market area, a specific marketing plan to develop alternative markets, the addition of new amenities or by increasing user fees. Exponential Percent Increase from Year to Year: Category Year 1 Year 2 Year 3 Year 4 Year 5 Expenditures 0% 1% 3% 3% 3% Revenues 0% 7% 7% 5% 3% Page 65

OPERATIONS ANALYSIS 5 Year Comparison Seasonal Category Year 1 Year 2 Year 3 Year 4 Year 5 Expenditures $355,856 $359,415 $370,197 $381,303 $392,742 Revenues $102,170 $109,322 $116,974 $122,823 $128,964 Difference ($253,686) ($250,093) ($253,223) ($258,480) ($263,778) Recovery % 29% 30% 32% 32% 33% Percent Recovery Rate Recovery Rate 34% 32% 32% 32% 33% 30% 28% 29% 30% Recovery Rate 26% Year 1 Year 2 Year 3 Year 4 Year 5 Page 66

OPERATIONS ANALYSIS Year Round Category Year 1 Year 2 Year 3 Year 4 Year 5 Expenditures $550,574 $556,080 $572,762 $589,945 $607,643 Revenues $166,800 $178,476 $190,969 $200,518 $210,544 Difference ($383,774) ($377,604) ($381,793) ($389,427) ($397,100) Recovery % 30% 32% 33% 34% 35% Percent Recovery Rate 36% 34% 32% 30% 28% 26% Recovery Rate 35% 34% 33% 32% 30% Year 1 Year 2 Year 3 Year 4 Year 5 Recovery Rate Additional Operations Option: In addition to the two options for operations that have been outlined above, a third option is seasonal operation from Memorial Day to Labor Day then weekends only during the rest of the year. This option is not recommended for the following reasons: To serve the needs of the school district and the swim teams the aquatic center will have to have some operational hours during the week in the off-season. Opening the aquatic center to the general public (on a limited basis) will be easier to accomplish during these time frames as some level of staffing will already be present. Fee options are limited beyond the traditional swim season. Annual passes and other extended use options will not be valid during the off season. This will severely limit the revenue sources during this time of year. It is difficult to open and close a facility for weekend use. It is also challenging to attract and keep staff with limited hours and days of employment. Page 67

OPERATIONS ANALYSIS Aquatics programming will be very limited with only weekend hours available. During the off-season most aquatic center users are primarily fitness and competitive swimmers who are looking for almost daily availability of pool time. Weekend only hours will virtually eliminate this use (and revenue). If this option were to be seriously considered, the operational performance would require higher expenditures for operations than the seasonal option but lower than the year round option. Overall revenues would be slightly higher than the seasonal option but considerably lower than the year round version. In the end the net loss would be the highest of the three operations options being considered. Page 68

OPERATIONS ANALYSIS Fees and Attendance Projected Fee Schedules: The following fee schedules have been figured without utilizing a resident/non-resident fee differential for non-residents of Desert Hot Springs on the admission rates. Revenue projections and attendance numbers were calculated from these fee models. Admissions Rate Adult Daily $3.00 Youth Daily (3-17) $2.00 Adult 10 Admiss. $25.00 Youth 10 Admiss. $17.00 Adult Season/3 Mon. Pass $50.00 Youth Season/3 Mon. Pass $45.00 Family Season/3 Mon. Pass $95.00 Adult Annual Pass $180.00 Youth Annual Pass $160.00 Family Annual Pass $340.00 Note: 10 admission rates are based on an approximate 15% discount on the daily admission rate. Rentals Rate Competitive Pool 25 yard/per lane $6/hr. Full Pool $75/hr. Splash Pool $30/hr. Page 69

OPERATIONS ANALYSIS Admission Rate Comparisons: The above rates were determined based on the rates paid at similar facilities in the Coachella Valley (2012). Wardman Park Pool Category Daily Season Pass Adults $2.00 $40.00 Youth (3-17) $1.00 $35.00 Family N/A $80.00 Palm Desert Aquatic Center Category Daily 25 Visits 3 Month Annual Res./N. Res. Res./N. Res. Res./N. Res. Res./N. Res. Adults $4.00/$6.00 $94/$142 $150/$225 $550/$825 Youth/Senior $3.00/$4.50 $65/$98 $110/$165 $420/$630 Junior (2-5) $2.50/$3.75 N/A N/A N/A Palm Springs Swim Center Category Daily 25 Visits Res./N. Res. Res./N. Res. Adults $4.00/$5.00 $60/$75 Youth (4-12) $3.00/$3.00 $60/$75 Pawley Aquatic Center Category Daily Adults $4.00 Youth (2-17) $3.00 Fritz Burns Community Pool Category Daily Adults (13 & older) $3.00 Youth (under 13) $2.00 Page 70

OPERATIONS ANALYSIS Attendance Projections: The following attendance projections are the basis for the revenue figures that were identified earlier in this report. The admission numbers are affected by the rates being charged, the facilities available for use, and the competition within the service area. These are averages only and are based on 90 days of operation for the seasonal option and a total of 350 days for the year round option. Seasonal Paid Admissions Daily 90 Days x 70 a Day 6,300 10 Admissions 300 Sold x 10 Admissions 3,000 Season/3 Mon. Passes 250 Sold x 20 Admissions 16 5,000 Total Yearly 14,300 Year Round Paid Admissions Summer Daily 90 Days x 70 a Day 6,300 Fall, Winter, Spring Daily 260 x 25 Admissions 6,500 10 Admissions 400 Sold x 10 Admissions 4,000 Season/3 Mon. Passes 250 Sold x 20 Admissions 17 5,000 Annual Passes 75 Sold x 100 Admissions 18 7,500 Total Yearly 29,300 16 Family passes are counted as a single admission. 17 Family passes are counted as a single admission. 18 Family passes are counted as a single admission. Page 71

OPERATIONS ANALYSIS Hours of Operation: The projected hours of operation of the aquatic center are as follows: Seasonal Summer (high season) Mid June thru Mid August (10 weeks) Days Hours Monday-Friday 7:00am-8:00pm Saturday-Sunday 8:00am-5:00pm Hours per Week 83 Summer (low season) Memorial Day to Mid June and Mid August to Labor Day (4 weeks) Days Hours Monday-Friday 2:00pm-8:00pm Saturday-Sunday Noon-5:00pm Hours per Week 46 The aquatic center will not be open to the general public during the rest of the year but will be available for group use (swim teams, water polo teams, etc.) plus other special programs (school swim lessons, etc.) It is expected that any off-season use will be on a pay for use basis. Year Round Summer (high season) Mid June thru Mid August (10 weeks) Days Hours Monday-Friday 7:00am-8:00pm Saturday-Sunday 8:00am-5:00pm Hours per Week 83 Summer (low season) Memorial Day to Mid June and Mid August to Labor Day (4 weeks) Days Hours Monday-Friday 2:00pm-8:00pm Saturday-Sunday Noon-5:00pm Hours per Week 40 Page 72

OPERATIONS ANALYSIS Fall, winter and spring Labor Day to Memorial Day (38 weeks) Days Hours Monday-Friday 1:00pm-6:00pm Saturday-Sunday Noon-5:00pm Hours per Week 35 Note: Seasons and hours will be adjusted based on use and demand as well as resources available to subsidize the operation. Page 73

APPENDIX Section IV - Appendix Part-Time Staff Hours Program Staffing Program Revenue Revenue Worksheets Page 74

APPENDIX Part-Time Staff Hours: Seasonal Fall, Winter, Spring September thru May (38 weeks) Title Days Hours Employees Days Total/Wk Center Manager Mon-Fri 4 1 5 20 (38 weeks) Sat. 3 1 1 3 TOTAL 23 Title Days Hours Employees Days Total/Wk Lead Lifeguard Mon-Fri 3 1 5 15 (38 weeks) Sat. 3 1 1 3 TOTAL 18 Title Days Hours Employees Days Total/Wk Custodian/Grounds Mon & 3 1 2 6 (38 weeks) Thurs TOTAL 6 Title Days Hours Employees Days Total/Wk Lifeguard Mon-Fri 3 1 5 15 (38 weeks) Sat. 3 1 1 3 TOTAL 18 Summer (low season) Memorial Day thru Mid June and Mid August thru Labor Day (4 weeks) Title Days Time Hours Employees Days Total/Wk Center Manager Mon-Fri 2:00P-8:00P 6 1 5 30 (4 weeks) Sat-Sun Noon-5:00P 5 1 2 10 TOTAL 40 Title Days Time Hours Employees Days Total/Wk Lead Lifeguard Mon-Fri 2:00P-8:00P 6 1 5 30 (4 weeks) Sat-Sun Noon-5:00P 5 1 2 10 TOTAL 40 Title Days Time Hours Employees Days Total/Wk Cashier Mon-Fri 2:00P-8:00P 6 1 5 30 (4 weeks) Sat-Sun Noon-5:00P 5 1 2 10 TOTAL 40 Page 75

APPENDIX Title Days Time Hours Employees Days Total/Wk Custodian/Grounds Mon, 1:00P-4:00P 3 1 3 9 (4 weeks) Thurs, Sat TOTAL 9 Title Days Time Hours Employees Days Total/Wk Lifeguard Mon-Fri 2:00P-8:00P 6 2 5 60 (4 weeks) Sat-Sun Noon-5:00P 5 2 2 20 TOTAL 80 Summer Mid June thru Mid August (10 weeks) Title Days Time Hours Employees Days Total/Wk Center Manager Tue-Fri 1:00P-8:00P 7 1 4 28 (10 weeks) Sat-Sun 11:00A- 6 1 2 12 5:00P TOTAL 40 Title Days Time Hours Employees Days Total/Wk Lead Lifeguard Mon-Fri 7:00A-1:00P 6 1 5 30 (10 weeks) Mon-Fri 1:00P-8:00P 7 1 5 35 Sat-Sun 8:00A-5:00P 9 1 2 18 TOTAL 83 Title Days Time Hours Employees Days Total/Wk Cashier Mon-Fri 7:00A-1:00P 6 1 5 30 (10 weeks) Mon-Fri 1:00P-8:00P 7 1 5 35 Sat-Sun 8:00A-Noon 4 1 2 8 Sat-Sun Noon-5:00P 5 1 2 10 TOTAL 83 Title Days Time Hours Employees Days Total/Wk Custodian/Grounds Mon-Sun 8:00P- 2 1 7 14 (10 weeks) 10:00P TOTAL 14 Page 76

APPENDIX Title Days Time Hours Employees Days Total/Wk Lifeguard Mon-Fri 7:00A-Noon 5 2 5 50 (10 weeks) Mon-Fri Noon-6:00P 6 3 5 90 Mon-Fri 6:00P-8:00P 2 2 5 20 Sat-Sun 8:00A-Noon 5 2 2 20 Sat-Sun Noon-5:00P 4 3 2 24 TOTAL 204 Year Round Fall, Winter, Spring September thru May (38 weeks) Note: The full-time Aquatic Center Manager will work Wednesday through Sunday, year round. Title Days Time Hours Employees Days Total/Wk Center Manager Mon-Tue 1:00P-6:00P 5 1 2 10 (38 weeks) TOTAL 10 Title Days Time Hours Employees Days Total/Wk Lead Lifeguard Mon-Fri 1:00P-6:00P 5 1 5 25 (38 weeks) Sat-Sun Noon-5:00P 5 1 2 10 TOTAL 35 Title Days Time Hours Employees Days Total/Wk Cashier Mon-Fri 1:00P-6:00P 5 1 5 25 (38 weeks) Sat-Sun Noon-5:00P 5 1 2 10 TOTAL 35 Title Days Time Hours Employees Days Total/Wk Custodian/Grounds Mon.Thur 9:00A-Noon 3 1 3 9 (38 weeks) Sat. TOTAL 9 Title Days Time Hours Employees Days Total/Wk Lifeguard Mon-Fri 1:00P-6:00P 5 1 5 25 (38 weeks) Sat-Sun Noon-5:00P 5 2 2 20 TOTAL 45 Page 77

APPENDIX Summer (low season) Memorial Day thru Mid June and Mid August thru Labor Day (4 weeks) Title Days Time Hours Employees Days Total/Wk Center Manager Mon-Tue 2:00P-8:00P 6 1 2 12 (4 weeks) TOTAL 12 Title Days Time Hours Employees Days Total/Wk Lead Lifeguard Mon-Fri 2:00P-8:00P 6 1 5 30 (4 weeks) Sat-Sun Noon-5:00P 5 1 2 10 TOTAL 40 Title Days Time Hours Employees Days Total/Wk Cashier Mon-Fri 2:00P-8:00P 6 1 5 30 (4 weeks) Sat-Sun Noon-5:00P 5 1 2 10 TOTAL 40 Title Days Time Hours Employees Days Total/Wk Custodian/Grounds Mon, 1:00P-4:00P 3 1 3 9 (4 weeks) Thurs, Sat TOTAL 9 Title Days Time Hours Employees Days Total/Wk Lifeguard Mon-Fri 2:00P-8:00P 6 2 5 60 (4 weeks) Sat-Sun Noon-5:00P 5 2 2 20 TOTAL 80 Summer Mid June thru Mid August (10 weeks) Title Days Time Hours Employees Days Total/Wk Center Manager Mon-Tue 7:00P-8:00P 13 1 2 26 (10 weeks) Wed-Fri 3:00P-8:00P 5 1 3 15 TOTAL 41 Title Days Time Hours Employees Days Total/Wk Lead Lifeguard Mon-Fri 7:00A-1:00P 6 1 5 30 (10 weeks) Mon-Fri 1:00P-8:00P 7 1 5 35 Sat-Sun 8:00A-5:00P 9 1 2 18 TOTAL 83 Page 78

APPENDIX Title Days Time Hours Employees Days Total/Wk Cashier Mon-Fri 7:00A-1:00P 6 1 5 30 (10 weeks) Mon-Fri 1:00P-8:00P 7 1 5 35 Sat-Sun 8:00A-Noon 4 1 2 8 Sat-Sun Noon-5:00P 5 1 2 10 TOTAL 83 Title Days Time Hours Employees Days Total/Wk Custodian/Grounds Mon-Sun 8:00P- 2 1 7 14 (10 weeks) 10:00P TOTAL 14 Title Days Time Hours Employees Days Total/Wk Lifeguard Mon-Fri 7:00A-Noon 5 2 5 50 (10 weeks) Mon-Fri Noon-6:00P 6 3 5 90 Mon-Fri 6:00P-8:00P 2 2 5 20 Sat-Sun 8:00A-Noon 5 2 2 20 Sat-Sun Noon-5:00P 4 3 2 24 TOTAL 204 Page 79

APPENDIX Program Staffing Costs Seasonal Spring & Fall Swim Lessons Title Classes Staff Pay Sessions/ Total Cost Weeks School Learn to Swim 5 classes/8 days $10.00/cl. 5 sessions $2,000 Mon.-Wed. 2 weeks TOTAL $2,000 Summer Swim Lessons (weekday classes meet four days a week for two weeks) Title Classes Staff Pay Sessions/ Total Cost Weeks Infant & Preschool 5 classes/8 days $10.00/cl. 4 sessions $1,600 Mon.-Thurs. Learn to Swim 8 classes/8 days $10.00/cl. 4 sessions $2,560 Mon.-Thurs Private Lessons 2 classes/wk $10.00/cl. 14 weeks $280 TOTAL $4,440 Other Title Classes Staff Pay Sessions/ Total Cost Weeks Water Exercise 4 classes/3 days $15.00/cl. 14 weeks $2,520 Youth Water Polo 1class/8 days $20.00/cl. 2 sessions $320 Jr. Lifeguard 1class/8 days $15.00/cl. 2 sessions $240 Lifeguard Training 33hours $15.00/hr. 1 session $495 CPR Training 5hours $15.00/hr. 1 session $75 Birthday Parties 5 week $15.00/hr. 14 weeks $1,050 Special Events 6 hours $10.00/hr. 3 events $1,080 6 staff Misc. 2 classes/3 days $15.00/cl. 14 weeks $1,260 TOTAL $7,040 Total Aquatics Programs $13,480 Page 80

APPENDIX Year Round Spring & Fall Swim Lessons Title Classes Staff Pay Sessions/ Total Cost Weeks School Learn to Swim 5 classes/8 days $10.00/cl. 5 sessions $2,000 Mon.-Wed. 2 weeks TOTAL $2,000 Swim Lessons (weekday classes meet two days a week for four weeks) Title Classes Staff Pay Sessions/ Total Cost Weeks Infant & Preschool 3 classes/8 days $10.00/cl. 2 sessions $480 Mon.&Wed. Learn to Swim 4 classes/8 days $10.00/cl. 2 sessions $640 Tue.&Thurs. Private Lessons 2 classes/wk $10.00/cl. 8 weeks $160 TOTAL $1,280 Other Title Classes Staff Pay Sessions/ Total Cost Weeks Water Exercise 2 classes/3 days $15.00/cl. 38 weeks $3,420 Lifeguard Training 33hours $15.00/hr. 1 session $495 CPR Training 5hours $15.00/hr. 1 session $75 Birthday Parties 2 week $15.00/hr. 20 weeks $600 Misc. 2 classes/3 days $15.00/cl. 20 weeks $1,800 TOTAL $6,390 Page 81

APPENDIX Summer Swim Lessons (weekday classes meet four days a week for two weeks) Title Classes Staff Pay Sessions/ Total Cost Weeks Infant & Preschool 5 classes/8 days $10.00/cl. 4 sessions $1,600 Mon.-Thurs. Learn to Swim 8 classes/8 days $10.00/cl. 4 sessions $2,560 Mon.-Thurs Private Lessons 2 classes/wk $10.00/cl. 14 weeks $280 TOTAL $4,440 Other Title Classes Staff Pay Sessions/ Total Cost Weeks Water Exercise 4 classes/3 days $15.00/cl. 14 weeks $2,520 Youth Water Polo 1class/8 days $20.00/cl. 2 sessions $320 Jr. Lifeguard 1class/8 days $15.00/cl. 2 sessions $240 Lifeguard Training 33hours $15.00/hr. 1 session $495 CPR Training 5hours $15.00/hr. 1 session $75 Birthday Parties 5 week $15.00/hr. 14 weeks $1,050 Special Events 6 hours $10.00/hr. 3 events $1,080 6 staff Misc. 2 classes/3 days $15.00/cl. 14 weeks $1,260 TOTAL $7,040 Total Aquatics Programs $21,150 Page 82

APPENDIX Program Revenues Seasonal Spring & Fall Swim Lessons Title Classes Fee Sessions/ Weeks Total Revenue School Learn to Swim 5 classes/6 per class $20.00 5 sessions $3,000 TOTAL $3,000 Summer Swim Lessons (weekday classes meet four days a week for two weeks) Title Classes Fee Sessions/ Weeks Total Revenue Infant & Preschool 5 classes/4 per class $35.00 4 sessions $2,800 Learn to Swim 8 classes/4 per class $35.00 4 sessions $4,480 Private Lessons 2 classes/wk $15.00/cl. 14 weeks $420 TOTAL $7,700 Other Title Classes Fee Sessions/ Weeks Total Revenue Water Exercise 12 classes/8 per class $5.00/cl. 10 weeks $4,800 Youth Water Polo 1class/15 per class $40.00 2 sessions $1,200 Jr. Lifeguard 1class/5 per class $40.00 2 sessions $400 Lifeguard Training 1 class/10 per class $150.00 1 session $1,500 CPR Training 1class/5 per class $30.00 1 session $150 Birthday Parties 5 week $90.00 14 weeks $6,300 Special Events 30 per event $5.00 3 events $450 Misc. 6 classes/5 per class $5.00/cl. 14 weeks $2,100 TOTAL $16,900 Total Aquatics Program Revenue $27,600 Page 83

APPENDIX Year Round Spring & Fall Swim Lessons Title Classes Fee Sessions/ Weeks Total Revenue School Learn to Swim 5 classes/6 per class $20.00 5 sessions $3,000 TOTAL $3,000 Swim Lessons (weekday classes meet two days a week for four weeks) Title Classes Fee Sessions/ Weeks Total Revenue Infant & Preschool 3 classes/4 per class $35.00 2 sessions $840 Learn to Swim 4 classes/4 per class $35.00 2 sessions $1,120 Private Lessons 2 classes/wk $15.00/cl. 8 weeks $240 TOTAL $2,200 Other Title Classes Fee Sessions/ Weeks Total Revenue Water Exercise 6 classes/8 per class $5.00/cl. 38 weeks $9,120 Lifeguard Training 1 class/10 per class $150.00 1 session $1,500 CPR Training 1class/5 per class $30.00 1 session $150 Birthday Parties 2 week $90.00 20 weeks $3,600 Misc. 6 classes/5 per class $5.00/cl. 20 weeks $3,000 TOTAL $17,370 Summer Swim Lessons (weekday classes meet four days a week for two weeks) Title Classes Fee Sessions/ Weeks Total Revenue Infant & Preschool 5 classes/4 per class $35.00 4 sessions $2,800 Learn to Swim 8 classes/4 per class $35.00 4 sessions $4,480 Private Lessons 2 classes/wk $10.00/cl. 14 weeks $280 TOTAL $7,560 Page 84

APPENDIX Other Title Classes Fee Sessions/ Weeks Total Revenue Water Exercise 12 classes/8 per class $5.00/cl. 10 weeks $4,800 Youth Water Polo 1class/15 per class $40.00 2 sessions $1,200 Jr. Lifeguard 1class/5 per class $40.00 2 sessions $400 Lifeguard Training 1 class/10 per class $150.00 1 session $1,500 CPR Training 1class/5 per class $30.00 1 session $150 Birthday Parties 5 week $90.00 14 weeks $6,300 Special Events 30 per event $5.00 3 events $450 Misc. 6 classes/5 per class $5.00/cl. 14 weeks $2,100 TOTAL $16,900 Total Aquatics Program Revenue $47,030 Page 85

APPENDIX Admission Revenue Seasonal Summer Daily Fees (14 weeks) Category Daily Fee # per Day Revenue Adult $3.00 20 $60 Youth $2.00 50 $100 TOTAL 70 $160 DAYS per SEASON 90 GRAND TOTAL $14,400 10 Admissions Category 10 Admissions # Sold Revenue Adult $25.00 100 $2,500 Youth $17.00 200 $3,400 TOTAL 300 GRAND TOTAL $5,900 Season Passes Category Season Passes # Sold Revenue Adult $50.00 50 $2,500 Youth $45.00 75 $3,375 Family $95 125 $11,875 TOTAL 250 GRAND TOTAL $17,750 Total Admission Revenue Category Revenue Daily $14,400 10 Admission $5,900 Season Passes $17,750 GRAND TOTAL $38,050 Page 86

APPENDIX Year Round Summer Daily Fees (14 weeks) Category Daily Fee # per Day Revenue Adult $3.00 20 $60 Youth $2.00 50 $100 TOTAL 70 $160 DAYS per SEASON 90 GRAND TOTAL $14,400 Fall/Winter/Spring Daily Fees (38 weeks) Category Daily Fee # per Day Revenue Adult $3.00 10 $30 Youth $2.00 15 $30 TOTAL 25 $60 DAYS per SEASON 260 GRAND TOTAL $15,600 10 Admissions Category 10 Admissions # Sold Revenue Adult $25.00 150 $3,750 Youth $17.00 250 $4,250 TOTAL 400 GRAND TOTAL $8,000 Season/3 Month Passes Category Season Passes # Sold Revenue Adult $50.00 50 $2,500 Youth $45.00 75 $3,375 Family $95.00 125 $11,875 TOTAL 250 GRAND TOTAL $17,750 Page 87

APPENDIX Annual Passes Category Season Passes # Sold Revenue Adult $180.00 25 $4,500 Youth $160.00 25 $4,000 Family $340.00 25 $8,500 TOTAL 75 GRAND TOTAL $17,000 Total Admission Revenue Category Revenue Daily $30,000 10 Admission $8,000 Season/3 Mon. Passes $17,750 Annual Passes $17,000 GRAND TOTAL $72,750 Note: These work sheets were used to project possible revenue sources and amounts. These figures are estimates only, based on very basic market information and should not be considered as guaranteed absolutes. This information should be utilized as a representative revenue scenario only and to provide possible revenue target ranges. Page 88

John H. FurbeeAquatics Center Operations Study

Study Contents Demographic Summary & Market Review Benchmark Facilities Operations Analysis

Demographics Service Areas Primary Service Area City s sphere of influence Secondary Service Area White Water to Morongo Valley and North Palm Springs to Thousand Palms

Demographic Summary City of Desert Hot Springs Primary Service Area Demographics Secondary Service Area Population: 2010 Census 25,938 36,661 47,493 2012 Estimate 26,288 37,297 48,308 2017 Estimate 27,763 39,657 51,393 Population Growth 2000-2010 Census +46.2% +52.6% +50.4% Households: 2010 Census 8,650 12,133 16,978 2012 Estimate 8,843 12,436 17,410 2017 Estimate 9,229 13,042 18,286 Families: 2010 Census 5,782 8,188 10,971 2012 Estimate 5,905 8,320 11,142 2017 Estimate 6,215 8,802 11,808 Average Household Size: 2010 Census 2.98 3.00 2.78 2012 Estimate 2.96 2.98 2.76 2017 Estimate 2.99 3.02 2.80 Ethnicity: Hispanic 55.2% 56.1% 50.8% White 57.4% 58.9% 62.9% Black 7.5% 6.6% 5.5% American Indian 1.4% 1.3% 1.4% Asian 2.5% 2.2% 2.0% Pacific Islander 0.3% 0.3% 0.2% Other 26.0% 26.1% 23.7% Multiple 4.9% 4.6% 4.3% Median Age: 2010 Census 31.1 32.4 35.7 2012 Estimate 31.7 32.7 36.2 2017 Estimate 32.4 33.5 37.2 Median Household Income: 2012 Estimate $31,976 $33,139 $33,192 2017 Estimate $35,946 $37,435 $37,607 Household Budget Expenditures 1 : Housing 67 68 68 Entertainment & Recreation 65 68 69

Median Age Demographics 2010 Census 2012 Projection 2017 Projection 31.1 31.7 32.4 Primary Service Area 32.4 32.7 33.5 Secondary Service Area 35.7 36.2 37.2 State of California 35.2 35.3 35.8 Nationally 37.1 37.3 37.8

Median Household Income 2012 Estimate 2017 Projection $31,976 $35,946 Primary Service Area $33,139 $37,435 Secondary Service Area $33,192 $37,607 State of California $57,385 $67,664 Nationally $50,157 $56,895

Spending Potential Index Demographics SPI Average Amount Spent Percent Housing 67 $13,178.98 31.2% Shelter 67 $10,236.58 24.3% Utilities, Fuel, Public Service 67 $2,942.40 7.0% Entertainment & Recreation 65 $2,040.13 4.8% Primary Service Area SPI Average Amount Spent Percent Housing 68 $13,435.00 31.0% Shelter 68 $10,394.14 23.9% Utilities, Fuel, Public Service 69 $3,040.86 7.0% Entertainment & Recreation 68 $2,111.29 4.9% Secondary Service Area SPI Average Amount Spent Percent Housing 68 $13,295.53 30.4% Shelter 67 $10,295.27 23.3% Utilities, Fuel, Public Service 71 $3,100.26 7.1% Entertainment & Recreation 69 $2,158.77 4.9% State of California SPI Average Amount Spent Percent Housing 122 $24,091.71 31.7% Shelter 126 $19,248.87 25.3% Utilities, Fuel, Public Service 110 $4,842.84 6.4% Entertainment & Recreation 120 $3,735.75 4.9%

Spending Potential Index Demographics SPI Average Spent Fees for Participant Sports 63 $64.95 Fees for Recreational Lessons 60 $79.48 Social, Recreation, Club Membership 61 $96.39 Exercise Equipment/Game Tables 52 $41.61 Other Sports Equipment 65 $5.94 Primary Service Area SPI Average Spent Fees for Participant Sports 65 $67.64 Fees for Recreational Lessons 60 $79.05 Social, Recreation, Club Membership 61 $97.04 Exercise Equipment/Game Tables 54 $43.16 Other Sports Equipment 66 $6.06 Secondary Service Area SPI Average Spent Fees for Participant Sports 67 $69.36 Fees for Recreational Lessons 57 $75.47 Social, Recreation, Club Membership 61 $97.64 Exercise Equipment/Game Tables 55 $43.96 Other Sports Equipment 66 $6.09 State of California SPI Average Spent Fees for Participant Sports 123 $127.15 Fees for Recreational Lessons 128 $169.84 Social, Recreation, Club Membership 123 $195.62 Exercise Equipment/Game Tables 96 $76.37 Other Sports Equipment 114 $10.43

Entertainment/Recreation Index

Primary Service Area

Primary Service Area Population Distribution by Age Ages Population % of Total Nat. Population Difference -5 3,191 8.6% 6.5% +2.1% 5-17 7,840 21.0% 17.2% +3.8% 18-24 3,750 10.1% 9.8% +0.3% 25-44 9,558 25.6% 26.5% -0.9% 45-54 4,704 12.6% 14.1% -1.5% 55-64 3,661 9.8% 12.3% -2.5% 65-74 2,652 7.1% 7.5% -0.4% 75+ 1,943 5.2% 6.1% -0.9%

Primary Service Area Population Distribution Over Time Ages 2010 Census 2012 Projection 2017 Projection Percent Change Percent Change Nat l -5 3,159 3,191 3,368 +6.6% +4.7% 5-17 7,881 7,840 8,221 +4.3% +1.8% 18-24 3,699 3,750 3,695-0.1% -2.4% 25-44 9,463 9,558 10,031 +6.0% +10.4% 45-54 4,764 4,704 4,612-3.2% -6.2% 55-64 3,431 3,661 4,075 +18.8% +13.7% 65-74 2,413 2,652 3,428 +42.1% +32.9% 75+ 1,852 1,943 2,226 +20.2% +9.5%

Primary Service Area Ethnic Breakdown Ethnicity Total Median Age % of Population % of California Population Population Hispanic 20,922 24.1 56.1% 38.4% Ethnicity Total Population Median Age % of Population % of California Population White 21,975 40.5 58.9% 56.9% Black 2,444 26.1 6.6% 6.1% American Indian 491 27.6 1.3% 1.0% Asian 828 41.1 2.2% 13.2% Pacific Islander 100 26.7 0.3% 0.4% Other 9,728 24.1 26.1% 17.3% Multiple 1,731 20.0 4.6% 5.0%

Demographic Summary Primary Service Area at 37,297 is adequate for the pool, the total market is 48,308 The population will continue to grow The population is younger with large numbers of youth which is a positive Low median HH income, and low rates of discretionary income are negatives High Hispanic population will impact participation

Swimming Participation Participation % Activity Age Income Region Nation Average Swimming 17.4% 11.3% 14.5% 16.4% 14.9% Participation Numbers Activity Average 2010 Part. 2012 Part. 2017 Part. Difference Swimming 14.9% 4,808 4,896 5,211 +402 Swimmer Days Average 2010 Part. 2012 Part. 2017 Part. Difference 40.00 192,357 195,874 208,450 +16,093

Swimming Participation Ethnic Participation Rates Primary Service Area National Participation African American Participation Hispanic Participation Swimming 14.9% 16.4% 6.8% 12.9% Adult Participation Primary Service Area Expected Percent of MPI Adults participated in: Number of Adults Population Swimming 4,644 17.8% 91

Adults Swimming Participation

Other Aquatic Facilities Palm Springs Swim Center Palm Desert Aquatic Center Pawley Aquatic Center Fritz Burns Community Pool School District Pools

Opportunities Market Summary WardmanPark Pool needs to be replaced No other public pools in the immediate area New facility will serve the competitive needs Beautiful facility Operating in conjunction with the Health & Wellness Center and Boys & Girls Club Will be a program pool, must attract other users Marketing will be important

Market Summary Constraints Limited appeal to the recreational swimmer Difficult to draw users from beyond the secondary market Summer weather can be too hot without a cooling system Demographic characteristics contribute to a reduced rate of aquatic use

Market Summary Recommendations Do not open to the public before Memorial Day Need to determine who will manage and operate Operate on a seasonal basis only The school district should be charged for use Shut down the Wardman Park Pool permanently

Market Summary Recommendations Access to the playground will need to be determined Establish a 4 th grade learn to swim program May need more shade, area for birthday parties, and a cooling system Promotional material in English and Spanish

Benchmark Facilities Palm Springs Swim Center Palm Desert Aquatic Center Pawley Aquatic Complex Valley-Wide Aquatic Center

Operations Operations Parameters Operations by the City Two options Seasonal and Year Round Strong level of programming All users will pay market rates Wardman Park Pool will remain closed Reasonably aggressive approach to fees and revenues

Operations Expenses Personnel Seasonal Year Round Full-Time $0 $60,750 Part-Time $113,856 $146,824 TOTAL $113,856 $207,574 Commodities Seasonal Year Round Office Supplies (forms, paper) $2,000 $3,000 Chemicals (provided by Knorr ) $73,000 $93,000 Maint./Repair/Mat. $3,000 $4,000 Janitor Supplies $10,000 $15,000 Rec. Supplies (program) $2,000 $3,000 Uniforms $2,500 $3,500 Printing/Postage $5,000 $6,000 Resale Items $2,000 $2,500 Other $1,000 $1,500 TOTAL $100,500 $131,500

Operations Contractual Seasonal Year Round Utilities 1 (gas & electric) $75,000 $125,000 Water/Sewer $10,000 $12,000 Insurance (Prop. & Liab.) $20,000 $25,000 Communications (phone) $1,000 $1,000 Contract Services 2 $20,000 $25,000 Rental Equipment $1,000 $1,000 Advertising $5,000 $8,000 Training $1,000 $1,500 Conference $500 $500 Membership/Dues/Subscriptions $500 $500 Trash Pickup $2,000 $3,000 Bank Charges $500 $1,000 Other $2,000 $3,000 TOTAL $138,500 $206,500 Capital Seasonal Year Round Replacement Fund 1 $3,000 $5,000 TOTAL $3,000 $5,000

Staffing Seasonal Year Round Full-Time Positions Positions Total Positions Total Aquatic Center Manager 0 $45,000 1 $45,000 Operations Benefits (35%) $0 $15,750 TOTAL 0 F.T.E. $0 1 F.T.E. $60,750 Seasonal Year Round Part-Time Positions Hours Weeks Hours Weeks Center Manager $17.00 Winter/Spring/Fall 23 38 10 38 Summer (high season) 40 10 41 10 Summer (low season) 40 4 12 4 Lead Lifeguard $13.00 Winter/Spring/Fall 18 38 35 38 Summer (high season) 83 10 83 10 Summer (low season) 40 4 40 4 Lifeguard $10.00 Winter/Spring/Fall 18 38 45 38 Summer (high season) 204 10 204 10 Summer (low season) 80 4 80 4 Cashier $9.50 Winter/Spring/Fall 0 38 35 38 Summer (high season) 83 10 83 10 Summer (low season) 40 4 40 4 Custodian/Grounds $10.00 Winter/Spring/Fall 6 38 9 38 Summer (high season) 14 10 14 10 Summer (low season) 9 4 9 4 Program Instructors 1 Aquatics Variable $13,480 Variable $21,150 Variable Salaries $103,505 $133,476 Benefits (10%) $10,351 $13,348 TOTAL $113,856 $146,824

Operations Revenues Fees Seasonal Year Round Daily Admissions $14,400 $30,000 10 Admissions $5,900 $8,000 Season/3 Month Passes 1 $17,750 $17,750 Annual Passes $0 $17,000 Corporate/Group $5,000 $7,000 Rentals 2 $15,500 $22,000 School District Rental 3 $8,520 $8,520 TOTAL $67,070 $110,270 Programs 1 Seasonal Year Round Aquatics $27,600 $47,030 Contract $500 $750 TOTAL $28,100 $47,780 Other Seasonal Year Round Resale Items (150% of cost) $3,000 $3,750 Special Events $1,000 $1,000 Vending $3,000 $4,000 TOTAL $7,000 $8,750

Operations Expenditure - Revenue Comparisons Category Seasonal Year Round Expenditures $355,856 $550,574 Revenues $102,170 $166,800 Difference (253,686) (383,774) Recovery % 29% 30%

Operations 5 Year Budgets Seasonal Category Year 1 Year 2 Year 3 Year 4 Year 5 Expenditures $355,856 $359,415 $370,197 $381,303 $392,742 Revenues $102,170 $109,322 $116,974 $122,823 $128,964 Difference ($253,686) ($250,093) ($253,223) ($258,480) ($263,778) Recovery % 29% 30% 32% 32% 33% Year Round Category Year 1 Year 2 Year 3 Year 4 Year 5 Expenditures $550,574 $556,080 $572,762 $589,945 $607,643 Revenues $166,800 $178,476 $190,969 $200,518 $210,544 Difference ($383,774) ($377,604) ($381,793) ($389,427) ($397,100) Recovery % 30% 32% 33% 34% 35%

Rate Structure Operations Admissions Rate Adult Daily $3.00 Youth Daily (3-17) $2.00 Adult 10 Admiss. $25.00 Youth 10 Admiss. $17.00 Adult Season/3 Mon. Pass $50.00 Youth Season/3 Mon. Pass $45.00 Family Season/3 Mon. Pass $95.00 Adult Annual Pass $180.00 Youth Annual Pass $160.00 Family Annual Pass $340.00 Rentals Rate Competitive Pool 25 yard/per lane $6/hr. Full Pool $75/hr. Splash Pool $30/hr.

Operations Attendance Seasonal Paid Admissions Daily 90 Days x 70 a Day 6,300 10 Admissions 300 Sold x 10 Admissions 3,000 Season/3 Mon. Passes 250 Sold x 20 Admissions 1 5,000 Total Yearly 14,300 Year Round Paid Admissions Summer Daily 90 Days x 70 a Day 6,300 Fall, Winter, Spring Daily 260 x 25 Admissions 6,500 10 Admissions 400 Sold x 10 Admissions 4,000 Season/3 Mon. Passes 250 Sold x 20 Admissions 2 5,000 Annual Passes 75 Sold x 100 Admissions 3 7,500 Total Yearly 29,300

Operations Hours of Operation Seasonal Summer (high season) Mid June thru Mid August (10 w Days Hours Monday-Friday 7:00am-8:00pm Saturday-Sunday 8:00am-5:00pm Hours per Week 83 Summer (low season) Memorial Day to Mid June and M Days Hours Monday-Friday 2:00pm-8:00pm Saturday-Sunday Noon-5:00pm Hours per Week 46

Operations Year Round Summer (high season) Mid June thru Mid August (10 w Days Hours Monday-Friday 7:00am-8:00pm Saturday-Sunday 8:00am-5:00pm Hours per Week 83 Summer (low season) Memorial Day to Mid June and M Days Hours Monday-Friday 2:00pm-8:00pm Saturday-Sunday Noon-5:00pm Hours per Week 40 Fall, winter and spring Labor Day to Memorial Day (3 Days Hours Monday-Friday 1:00pm-6:00pm Saturday-Sunday Noon-5:00pm Hours per Week 35